Chipotle’s Shares Soar on First Day

Shares of fast-growing restaurant chain Chipotle Mexican Grill Inc. doubled in their market debut Thursday, closing at $44.

But analysts warned that the first-day surge pushed the price-to-earnings ratio of the McDonald’s Corp. spinoff to a level far above most of its rivals, a situation that could sour investors who bought at top prices.

Chipotle shares gained $22 on the New York Stock Exchange, the biggest first-day advance for an initial public offering so far in 2006. During the day, they traded as high as $48.05.

“Is it going to $53.25 or $33.25 in the next move? I would say it would be to the downside, and rightly so,” said David Menlow, president of IPOFinancial.com, an independent research firm in Millburn, N.J.

“We like the company, we like what they do, everything about it is great, but at some point you can’t breathe too well at 43,000 feet,” Menlow added.

The 7.9-million-share Chipotle offer was worth $173.8 million.