Obama's Executive Action Sends Chipotle Stock Higher In Early Trading

Fears of restricted burrito access give the embattled chain the boost it sorely needs.

With the news that President Barack Obama will announce a slate of new executive actions this morning aimed at restricting access to burritos, shares in embattled Mexican eatery chain Chipotle (CMG) soared in early trading.

After struggling for weeks, Chipotle saw its stock price climb by almost 1% in the echoes of the opening bell. Many analysts are seeing a direct causation with the President's expected late morning announcement that he will supercede Congress and implement new rules restricting access to burritos after recent burrito-related mass tragedies nationwide.

As seen in the past, burrito enthusiasts tend to create potent short-term demand when they suspect that their ability to get burritos will be compromised in any way. That phenomenon seems to be at the core of Chipotle's late rally this morning and Wall Street is already responding favorably to improved guidance from the company.

According to Chipotle analyst I.P. Freely, the company's much needed morning of positive trading makes perfect sense when weighted against the news cycle. "Burrito people don't like to hear that they might find it harder to get their hands on a cylindrically-folded tortilla filled with meat, rice and vegetables," said Freely. "When they see in the news that 'Obama is coming for their burritos,' they immediately go and stock up on burritos."

It is unclear how quickly the President's actions would take effect as he and his allies can expect swift and strong opposition from the National Burrito Association, the well-funded and powerful pro-burrito lobby that vehemently opposes the executive order. The organization has already expressed fears that the President's restrictions could be later applied to tacos or even Sofritas bowls.

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