The correct answer is      (C.) Chipotle (CMG)

CMG announced its first-quarter 2009 earnings and it would have been hard to ask for anything better from the casual dining restaurant chain -- revenues increased by +16% and net income by almost +47%, when compared to the last year's first quarter. Wall Street analysts had projected the company would earn $0.55 per share -- and first quarter earnings came in at $0.78 per share.

However, most of CMG's revenue growth was due to the 26 new restaurants it opened this quarter and the +8% price hikes it instituted in the fourth quarter of 2008. CMG reported a +2.2% increase comparable restaurant sales for the first quarter 2009, compared to a +10.2% increase in the first quarter of 2008. The company anticipates same-store sales to increase only in the single digits for the 2009, supported by its earlier price hikes.

Without its price hikes, CMG's results would reflect declining same-store sales. That's partly why StreetAuthority editor Paul Tracy sold his CMG position in April, despite racking up a +97.6% gain in the stock. In his latest issue of the Market Advisor newsletter, Paul explains why he thinks CMG's fundamental growth story is beginning to wane and why price hikes are no longer an option for CMG. To read Paul's story, and to learn more about Market Advisor, please visit this link.