This chart shows why analysts feel 'encouraged' by Chipotle's January sales


Source: Chipotle Mexican Grill; Chipotle didn't disclose traffic for October-January

Chipotle Mexican Grill still has plenty of work to do if it hopes to persuade diners back to its stores. However, analysts seem to be feeling a bit more optimistic about the company's chances at a turnaround after the burrito chain disclosed strong same-store sales growth in January.

While fourth-quarter same-store sales growth fell 4.8 percent, the burrito chain noted that same-store sales in the first month of year were up 24.6 percent. Due to this positive growth, Nomura-Instinet analyst Mark Kalinowski raised his full-year 2017 same-store sales forecast by one percentage point to 9.5 percent.

"This represents a solid start for the year against Chipotle's easiest comparison," John Zolidis, an analyst with Buckingham Research Group, wrote in a research note Friday. "Looking forward, we believe that the sales recovery will accelerate as management aligns store teams against revised customer-oriented goals and as digital and marketing efforts are brought to bear."

The company's same-store sales turned positive in December, rising 14.7 percent, after 13 months of negative same-store sales growth.

Chipotle restaurant workers in Miami
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Traffic recovered faster than same-store sales for the company, which increased its promotions for free and discounted burritos as it worked to drive consumers back to its stores. Chipotle execs noted during its earnings conference call that the gap between sales and transactions has narrowed as its promotional activity has decreased.

Peter Saleh of BTIG is also feeling "encouraged" by the company's positive same-store sales growth in January, however, he remains skeptical about Chipotle's ability to sustain these sales.

"For the remainder of the year, we expect same-store sales to be volatile as the company laps last year's aggressive promotional activity," he wrote in a research note Friday. "We believe the launch of TV ads as part of the new campaign in April could help aid the recovery but remain cautious given the sales and promotional comparisons, noting January did represent the easiest comparison. We would await more consistent top-line trends and greater earnings confidence before becoming more constructive."

Chipotle shares shed more than 3 percent Friday, recently trading hands at $409.96.