Shares of Chipotle Mexican Grill shed more than 10 percent Wednesday as analysts foresee more trouble ahead for the burrito chain.
Chipotle is on pace for its worst day since Oct. 25, following a number of stock downgrades and price cuts after the company posted fourth-quarter earnings on Tuesday that were only slightly better than expectations.
The company said that an increase in the average check helped bolster earnings despite slowing foot traffic. Chipotle said it expects traffic will continue to decline through the middle of the year.
"We expect negative traffic to persist," Stifel analyst Chris O'Cull wrote in a research note Tuesday. "The company seems to be relying on easier comparisons this summer, rather than any initiatives to reverse the trend. We believe improving traffic could prove especially difficult following the 5 percent menu price increase."
O'Cull downgraded the stock to sell from hold, lowering his price target to $250 from $310. Bank of America cut its price target to $270 from $285 and Morgan Stanley slashed its price target to $312 from $346. The lowest of those price targets implies Chipotle shares could sink more than 8 percent from their current value.