*

Scott Boatwright named Chipotle's interim CEO, worked

closely

with predecessor Niccol since 2018

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Investors confident in Chipotle's growth despite Niccol's

departure for Starbucks' ( SBUX ) top job

*

During Niccol's Chipotle tenure, sales doubled and stock

tripled

By Ananya Mariam Rajesh

Aug 15 (Reuters) - Chipotle Mexican Grill's ( CMG )

future may not be as bumpy as some shareholders fear upon the

departure of CEO Brian Niccol, investors said on Wednesday.

The burrito chain lost almost $6 billion in stock market value

on Tuesday after it announced that Niccol will depart at the end

of this month to become CEO of Starbucks ( SBUX ). But

Chipotle's chief operating officer, Scott Boatwright, will serve

as its interim CEO, and the investors said he will provide a

steady hand.

During his tenure as COO, Boatwright along with Niccol

oversaw improvements in the quality of the food at Chipotle's

more than 3,000 restaurants, eliminating flavor and taste

inconsistencies, helping to lift the chain's sales and profit.

"I have confidence they will continue to double down on the

smart initiatives that are already well-entrenched inside the

company," said Eric Clark, portfolio manager at Accuvest Global

Advisors, which owns roughly $3.5 million in Chipotle shares.

During Boatwright's joint visits with Niccol to Chipotle

locations, "Scott would say, 'Hey, show us how you make the

guacamole,' and they would go, 'This is how I do it,'" Niccol

said in a 2022 event hosted by the University of Chicago Booth

School of Business. "The answer we were looking for was, 'This

is how you do it at Chipotle.' . . . People like consistency."

Chipotle's ability to continue to deliver consistent results

under Boatwright remains to be seen, though some said the

company is in a good place. Chipotle shares closed slightly

lower on Wednesday at $51.65, with a year-to-date gain of nearly

13%.

Boatwright joined Chipotle in 2017, just a year before the

arrival of Niccol. Over the past five years its shares have

risen 243%. During this time, average per-unit volumes grew

steadily as the company reinvested in marketing to promote using

fresh ingredients and regain consumer trust after E. coli

outbreaks in 2015.

It also partnered with DoorDash ( DASH ) delivery service so

that customers could get their burritos and rice bowls faster

and more conveniently.

Don Nesbitt, senior portfolio manager at F/m Investments,

which holds a $7.4 million stake in Chipotle, said the chain

remains a "great growth opportunity" - in contrast to Starbucks ( SBUX ),

which he described as "an old growth stock that has become

broken ... I think Chipotle is a good stock to hold given its

growth with or without Brian."

Chipotle is still growing with more room to expand into

Canada, Mexico and overseas into Asia while Starbucks ( SBUX ) already

operates in those markets and around the world, Nesbitt added.

Unlike McDonald's, for instance, Chipotle has not "had

to resort to resurrecting their value meals," he said.

The burrito chain has yet to name an official successor to

Niccol as CEO, though some Chipotle investors said Boatwright

could be a reasonable candidate for the top job.

"If Boatwright is the new CEO, we think that is good enough

news for the company to deliver on growth targets," said Nancy

Tengler, CEO and chief investment officer at Laffer Tengler

Investments, which holds $3.4 million in Chipotle shares.