Chipotle Mexican Grill (CMG) Stock: Falling On Pershing Square Filing

Chipotle Mexican Grill, Inc. (NYSE: CMG)

Chipotle Mexican Grill is having a rough time in pre-market trading this morning and for good reason. Activist investor, Bill Ackman’s Pershing Square Funds, has filed a prospectus that is leading to concerns surrounding the stock. Below, we’ll talk about what we’re seeing from CMG in the market, why, and what we’ll be watching for ahead.

What We’re Seeing From CMG

As mentioned above, Chipotle Mexican Grill isn’t having the best of times in pre-market trading today. In fact, the stock is falling in the pre-market after a filing by Pershing Square spooked the market. While the session isn’t open for the day just yet, it looks as though the stock will be at least opening the day in the red. At the moment (8:06), CMG is trading at $412.25 per share after a loss of $3.84 per share or 0.92% thus far today.

Why The Stock Is Falling

As is usually the case, our partners at Trade Ideas were the first to alert us of the losses on CMG. As soon ass we received the alert, the CNA Finance team started digging to see why the stock was making a run for the bottom. It didn’t take long to dig up the story. Ultimately, the declines are the result of a filing from Pershing Square.

On Friday, after-hours, Pershing Square filed a prospectus that will allow it to sell shares of Chipotle Mexican Grill common stock here and there. While the group said that there are no current plans to sell the stock, they wanted to make it clear that they reserve the right to do so. That’s a big hit as Ackman and Pershing Square together own about 2.88 million shares, or a 10% stake in the company.

What We’ll Be Watching For Ahead

Moving forward, the CNA Finance team will be keeping a close eye on CMG. In particular, following the news that was released in the filing by Pershing Square, we’re interested in seeing if shares of CMG are indeed sold, and if so, how many will be unleashed. Nonetheless, we’ll keep a close eye on the news and continue to bring it to you as it breaks!

Update (8:41): Maxim says that Ackman and Pershing Square may be in the process of preparing an exit from CMG following today’s pre-market news.

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