Chipotle’s stock has been a favorite for investors due to its growth in unit count and per store sales, but recent reports of a sharp drop in per-restaurant sales have caused panic selling, leading to a 28% decrease in the stock price this year.

Last quarter, Chipotle reported a 4% decline in same-store sales, with revenue growing 3% to $3.1 billion. This decline in sales has resulted in a 27.4% decrease in restaurant-level operating margin compared to a year ago.

The decline in traffic and per store sales has been a major concern for Chipotle investors, leading to a decline in profits. If these issues are not resolved, the stock could continue to fall.

Investors are reconsidering Chipotle stock due to its high starting earnings multiple and collapsing stock price after recent comparable store sales figures. Chipotle currently trades at a trailing P/E ratio of 38.5.

With 3,839 company-owned restaurant locations, Chipotle has room for expansion, but the recent decline in same-store sales poses a threat to its future growth potential.

Chipotle’s recent struggles have led to uncertainty among shareholders, with factors like increased unemployment and consumer trading down to cheaper options contributing to the decline in traffic and sales.

Read more at Yahoo Finance: What’s Wrong With Chipotle Stock?