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Could Chipotle Mexican Grill’s (CMG) Robots Spur Its Next Leg Of Growth?

Chipotle Mexican Grill is a restaurant chain that has become quite popular among the younger generation. The reason for this popularity is that the company targets health-conscious individuals who want to have a dining experience that is somewhere in between a fast food restaurant and fine dining.

Susan Law Cain / Shutterstock.com

Chipotle offers burritos, tacos, and salads among other items that keep varying throughout the year. The company offers these products by sourcing organic produce. The animals it uses are raised humanely. This gives its customers an ethical and healthy dining experience.

Like any other restaurant in the US, CMG also had its fair share of problems. Keeping up with the growth has been hard due to the inflation that has crippled the American consumer in the past two years.

The company has offered meal deals, weekly offers, and specials to attract customers. One of its attempts backfired when people on social media noticed that the portion size had become smaller. However, the company was quickly able to correct its course and rectify the problems.

Most recently, the company has launched collaborative robots (cobots) that will aid in food preparation. Its Autocado robot can process an avocado in 26 seconds, making it ready to be put into its signature salad, the guacamole.

CMG figured out that 65% of its online orders contain bowls or salads, which it can greatly automate with its Autocado robot. This allows the employees to not only give a consistent experience to people who order online but also focus on guests who arrive at their physical locations.

This robot is currently being tested in two locations in California, a state where the minimum wage is $20 per hour. If the company can successfully implement its 'cobots', it would help it save costs on a massive scale.

Once those cost savings start to reflect on the company's financial statements, it could spur the next bull rally in the company's stock. Now would be a good time to get in to make the most of that growth.

Chipotle Mexican Grill isn’t on our latest list of the 31 Most Popular Stocks Among Hedge Funds. As per our database, 68 hedge fund portfolios held CMG at the end of the second quarter which was 60 in the previous quarter. While we acknowledge the potential of CMG as a leading investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as CMG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.   READ NEXT: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’. Disclosure: None. This article was originally published at Insider Monkey.