Chipotle's stock at current levels factors in investor concern surrounding the company's ability to improve sales and margins after a recent food scare crisis, Slabaugh commented in his upgrade note. But at the same time, Chipotle's stock is now "low enough to begin taking a fresh look at shares."

An Equal-Weight rating still implies there are concerns in owning the stock, including the rising competition in the fast-casual restaurant space, the analyst continued. Other factors that prevent a Buy rating include near-term cost pressures and further earnings per share revisions to the downside.

Finally, as it stands now there is no existing path toward sustainable positive traffic trend, which implies it is difficult for the analyst to assign a premium to the stock's multiple. Related Links:

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