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Traders lose their taste for Shake Shack

What a difference a month makes.

Shake Shack has drawn favorable comparisons to everything from Starbucks to Tesla. But after more than tripling its initial IPO price, shares of the Shack have been taken to the woodshed, falling 44 percent from recent highs of about a month ago. And some traders see more pain to come.

"The execution element is not just whether or not they can grow stores," David Seaburg said Monday on CNBC's "Trading Nation." "It's whether they can actually find success in other markets outside of New York."

Seaburg, head of sales trading at Cowen & Co., said the stock is too expensive given its current state. He said investors might want to wait and see if Shake Shack can deliver on its plans to expand past its existing stores before stepping in and buying.

"That's what I worry about," Seaburg said. "Let's see if they can do it, but before then I'm not willing to pay the multiple for the stock."

Last week, Goldman Sachs and Morgan Stanley downgraded their ratings of Shake Shack's stock to sell from neutral, citing in part, sky high valuations.

"Although our long-term constructive view on SHAK remains unchanged, the stock ranks amongst the stocks in our coverage with the greatest potential downside risk," the Goldman Sachs report said.

Read MoreNo one on Wall Street likes Shake Shack

From a technical perspective, the charts offer little relief. According to TradingAnalysis.com's Todd Gordon, Shake Shack shares are flirting with a key support level of $51. By his work, if it were to violate that level, more selling could soon ensue, and the stock could fall to new lows.

"The pullback has been quite sharp, and right now we're testing the final level," Gordon said Monday. "That's the do-or-die level. That's the must-hold level."

The stock closed up Monday, landing just under $52.

Meanwhile, investors are shifting money toward other fast-food competitors such as Chipotle, Gordon said. "Looks like the money has gone back over," he said. "Shake Shack is kind of getting shaken up here."

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