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Gartman: Why El Pollo Loco could be sign of a top

Gartman urges caution on El Pollo Loco

Investor appetite for fire-grilled chicken appears to be hearty, but that hunger could spell trouble for the broader markets.

Shares of fast-casual poultry joint El Pollo Loco climbed more than 125 percent in their first two days of trading. According to Dennis Gartman of "The Gartman Letter," that massive pop could be a cause for concern.

In his daily publication, Gartman wrote on Monday that he was concerned that "the names of new offerings are looking 'toppish.'"

"Is the market really healthy when an IPO with the name EL Pollo Loco … the Crazy Chicken … is a blow-out success and trades to a swift premium immediately," Gartman questioned in the note.

On CNBC's "Fast Money," Gartman said the action in El Pollo Loco was reminiscent of the days leading up to the dot-com bubble. "It reminds me so much of what happened in the late '90s and early part of this century."

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Gartman said that if you're playing the chicken market, "look at the people who produce chicken."

"Their profit margins are going to go aggressively higher," he said.

As for those looking to hop onto the El Pollo Loco parade, Gartman offered just two words of caution: "Be careful."

By CNBC's Michael Newberg