Case Study: How Chipotle Car Counts Over the Last 5 Years Correlate with Stock Prices
At Orbital Insight, we find that counting the number of cars in a retailer’s parking lots across the country can be a good indicator for how strong sales will be for that store chain. Our customers find it valuable to see and consider this daily information when evaluating the overall health of a particular brand/retailer. To provide a concrete example of how our data fits into the larger narrative of a company’s stock price, we examine below our car count data for Chipotle from the past five years versus the restaurant’s stock price over the same period.
Orbital Insight has seen massive flux in Chipotle’s retail traffic over the past five years. From January 2012 to May 2012, we witnessed a structural increase in Chipotle’s car traffic, which correlates with a gain of more than 80% in the stock price over the same period.
From March 2015 to December 2016, we’ve seen continued declines in car traffic, which was a precursor for a 40% decline in the stock price over the period. Of note is the sharp decline in car counts in Q4 2015, which coincided with two outbreaks of E. coli at the restaurant chain. Car traffic continued to decline through much of 2016 following these incidents, although Orbital Insight has seen traffic begin to stabilize since December 2016.
We will continue monitoring the changes in car traffic at Chipotle. Our data will be especially interesting in light of the departure of Chipotle’s co-CEO in December and, more recently, a major board shakeup at the chain, both of which may lead to new marketing strategies and innovations that could result in more visitors and a turnaround for the company.