Chipotle Mexican Grill (CMG) fourth quarter earnings were better than Wall Street was expecting. Adjusted earnings per share of $10.36 was better than the estimates of $9.71. The fast casual restaurant chain posted revenue of $2.52 billion just slightly topping the Bloomberg average estimate of $2.49 billion. Same-store sales also topped expectations 8.4% versus the 7.1% estimate.

Yahoo Finance Live's Julie Hyman and Josh Lipton break down the report.

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Editor's note: This article was written by Stephanie Mikulich

Video Transcript

JULIE HYMAN: We're taking a look at shares of Chipotle now. Following the release of its fourth quarter results, the shares up by about 2%, because we had a pretty broad beat here across the board for the various numbers here. First of all, let's mention revenue at $2.5 billion. That was pretty much in line with estimates big beat for earnings per share. As you can see there, $10.36 versus the $9.71.

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And, of course, it's Chipotle, so we got to talk about comp sales, 8.4% increase there versus the 7.1% that was estimated. And it looks like they're going to continue to open new restaurants in 2024. They're targeting 285 to 315. A margin, by the way, also, impressively, 14.4% above estimates of 13.8%.

Now I got to dig a little bit further into the numbers here, but there were some questions ahead of time. You know, what were they going to see in gains related to price versus gains related to volumes and traffic? Because Chipotle has pretty consistently been raising its prices. So I'm going to dig in, and I'm sure get more on the conference call about that, too.

JOSH LIPTON: Yeah. What's impressive, too, just initially is this stock had already been up a bunch. I mean, it was up about 25% since November. It was up more than 40% in just the past 12 months. And at least, initially, we're popping here in the after hours.

I mean, it's going to be interesting with margins beating like that. I want to hear more about the consumer, Julie, and, you know, when they're entering these Chipotle restaurants, what are they ordering, ordering it like they did six or nine months ago or are they trading for cheaper options. I think it will be interesting to hear about.

JULIE HYMAN: Yeah. A little more color here that I'm seeing in the statement in terms of cost inputs, right? They talk about food beverage and packaging costs in the fourth quarter increasing to some extent, higher mix of beef and inflation across the menu. They said higher costs for beef produce and queso. But at the same time, they said there were increases that helped offset that. And paper costs apparently were down. So that's something that helped as well. So interesting to hear about what's going up, queso going up, paper going down in terms of the costs there.