Travis Hoium

I look back on the history, there's not really this moment where, you know what, you could have bought Chipotle at 10 times earnings or 12 times earnings.

It has always traded for a pretty high price-to-earnings multiple.

If you just go back to the middle of 2024, the price-to-earnings multiple was 70.

Now, it's down to about 30.

Is this just a cautionary tale of, you know what, buy a great company, but price does matter at the end of the day?

So it's different paying a 70 PE multiple for a company with 100 restaurants that could grow to 1,000 versus 1,000 restaurants and maybe it can grow to 2,000 or 3,000?

Is that the way?

It's a difference of scale?

When we come back, we're going to talk about a stock that is pretty cheap on a price-to-earnings basis, but maybe doesn't have the same growth opportunity.

That is Target.

You're listening to Motley Fool Money.

Welcome back to Motley Fool Money.

Rachel, Target stock is down 46% over the past five years.

It's fallen out of favor with investors and shoppers alike.

Some of the same-star sales comps are a little bit, sometimes it's negative a little bit, sometimes they're a little bit positive.

But overall, just nothing really impressive going on at Target.

But the stock trades for 11 times earnings.

Is there hope for a bounce back here?

You brought up Fidelke coming in as CEO and the changes that could potentially happen, but Fidelke was the COO before.

So everything that has happened in the last five years, his fingerprints are all over it.