Chipotle to rally 13% on a traffic recovery: CLSA

Patrons of Chipotle restaurant in Denver line up for lunch.
Andy Cross | The Denver Post | Getty Images

CLSA raised its rating for Chipotle to outperform from underperform, citing a traffic turnaround due to the restaurant's new loyalty rewards.

"Chiptopia [rewards program] will be a key catalyst for traffic rebuild, in our view," CLSA's Jeremy Scott wrote in a note to clients Tuesday.

"It is a highly compelling and engaging platform that induces urgency, incentivizes consistency, and most importantly, re-energizes its most loyal customers."