Traders are betting big against this restaurant giant into earnings

Chipotle Mexican Grill Inc. signage on the floor of the New York Stock Exchange (NYSE) in New York, US, on Monday, May 4, 2026.

Michael Nagle | Bloomberg | Getty Images

Taco-bout bearish.

There are a lot of big earnings after today's close, including Microsoft, Google, T-Mobile and Ford. But it's one fast food giant that apparently has options traders most worried: Chipotle.

Options trading exploded in Chipotle Tuesday on volume more than eight times its monthly average and skewed heavily towards puts, with 240,000 puts trading versus under 17,000 calls.

Of the $8 million in put premiums, at least $2 million of it came from someone buying back 56,000 25-strike puts for Nov. 6 expiry that they had likely sold, while simultaneously selling the same number of 22.5-strike puts expiring mid-December, arguably on the margin an indication of weakening confidence as CMG's nears the trader's first strike and forces a roll down in price and out in time to give room for the stock to slip further.

Separately, there was another outright bearish bet: around 11:30 a.m. E.T, someone bought 7,500 28-strike puts expiring Nov. 20, a $1.1 million bet that needs Chipotle to drop another 5% the next 3.5 weeks.

"All of these look like earnings plays and our data show customers generally bearish," said Jason DeLorenzo, founder and owner at Volland, options positioning platform.

The $27 level is an interesting one from a technical perspective. It the shoulder line of a large head and shoulders pattern that goes back to January of 2021. Technicians often view a break below a ridge line as bearish price action.

"The last time Chipotle implied move before earnings was this low was July 2025 and the stock got crushed," DeLorenzo added.