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Goldman slashes Chipotle price target by $50

A employee sprinkles cheese on a burrito at a Chipotle Mexican Grill restaurant in Hollywood, California.
Patrick T. Fallon | Bloomberg | Getty Images

Goldman Sachs lowered its price target on Chipotle, citing the prospect of a sales drop as the boost from the beleaguered restaurant chain's recent promotion fades.

"[We are] reducing comp outlook on slowing Chiptopia [promotion] benefit," analyst Karen Holthouse wrote in a note to clients Tuesday.

"Chiptopia did drive increased web/app traffic in July; however, search trends continue to show a sharp drop-off in August. Given signs of a reduced benefit from Chiptopia in August."

Holthouse cut her Chipotle 12 month price target to $395 from $445, representing 1 percent downside from Tuesday's close. Goldman Sachs confirmed to CNBC the firm still has a neutral rating on the shares.