Piper Sandler upgraded Chipotle Mexican Grill (NYSE:CMG) from Neutral to Overweight, setting a price target of $50.00, down from $53.00. Shares rose more than 3% intra-day following the call.

The firm cited an attractive risk-reward profile, noting potential for roughly 20% upside in a base-case scenario assuming 3% comparable sales growth over the next two years. While acknowledging investor debate over whether Chipotle can maintain mid-single-digit same-store sales growth, Piper Sandler believes the market has largely priced in a softer growth outlook for next year.

The analysts recognized potential top-line risks in the second half of this year and maintained earnings estimates below consensus. However, they noted that with shares down about 31% year-to-date, much of the negative sentiment may already be reflected in the stock.