McDonald's Once Owned 90% Of Chipotle: Why It Sold Stake Too Early, Missed $73 Billion Opportunity
Portfolio Pulse from Chris Katje
McDonald's once owned a 90% stake in Chipotle, which it sold by 2006. This decision cost McDonald's a potential $73.8 billion, as Chipotle's market cap has since soared to $82 billion. The sale was driven by strategic focus on McDonald's core brand.
October 23, 2024 | 3:11 pm
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NEUTRAL IMPACT
McDonald's decision to sell its 90% stake in Chipotle by 2006 cost it a potential $73.8 billion. The sale was part of a strategy to focus on its core brand, but it missed out on Chipotle's massive growth.
McDonald's sale of its Chipotle stake was a strategic decision to focus on its core brand. While it missed out on significant gains, the decision aligns with its long-term strategy. The impact on McDonald's stock is neutral as the sale was long ago and the company remains strong.
CONFIDENCE 100
IMPORTANCE 80
RELEVANCE 90
POSITIVE IMPACT
Chipotle's market cap has grown to $82 billion since McDonald's sold its stake in 2006. The company's focus on quality and service, along with strategic drive-thru additions, has fueled its growth.
Chipotle's growth to a market cap of $82 billion highlights its successful strategy post-McDonald's ownership. The company's focus on quality and strategic additions like drive-thrus have contributed to its strong market position, likely boosting its stock price.
CONFIDENCE 100
IMPORTANCE 70
RELEVANCE 80