Chipotle Mexican Grill, Inc. (NYSE:CMG) pre-announced fourth-quarter results that reveal top-line trends are showing the sun might finally be peeking through the clouds for the burrito chain.

Wedbush analyst Nick Setyan finds the pre-announcement and improving top-line trajectory encouraging. For now, the analyst remains on the sidelines, reiterating a Neutral rating on CMG with a price target of $400, which represents a 2% downside from where the shares last closed.

Setvan highlights that comps have risen from -20.2% in October to -1.4% in November to now a substantial 14.7% jump in December. Meanwhile, year-ago December comparisons are -30%, which denotes a -1% on a two-year stack. If this positive two-year trending momentum carries through the first quarter of 2017, Setvan notes that this would indicate SSS growth of +15%, above the current +12% consensus estimate.

“We believe the December data point represents the first evidence of an improving sales trajectory that is in-line or above Street expectations,” continues Setvan. Therefore, the analyst is boosting his comp projection for the first quarter of 2017 from 13% to 15%.

Moreover, the analyst sees a new shift towards prioritizing margins, explaining, “Margins likely to remain under pressure in 2017, but 2018 opportunity intact. Q4 unit-level margins were below expectations due to higher-than-anticipated marketing spend and avocado costs. While we expect elevated costs to continue in 2017, we believe a pivot by management to focus on margins at current sales run rates is poised to benefit 2018.”

Ultimately, “Relative to peers, Chipotle’s largest medium- to long-term opportunity is lower labor costs, with other OpEx being the largest near-term opportunity as marketing and promotional spend declines. While higher turnover is likely to preclude meaningful labor improvement in 2017, we expect labor leverage to resume 2018. We also view a 2018 price increase as realistic,” Setvan surmises.

As usual, we like to include the analyst’s track record when reporting on new analyst notes to give a perspective on the effect it has on stock performance. According to TipRanks, five-star analyst Nick Setyan is ranked #401 out of 4,342 analysts. Setyan has a 63% success rate and realizes 9.5% in his annual returns. When recommending CMG, Setyan yields 10.9% in average profits on the stock.

TipRanks analytics demonstrate CMG as a Hold. Based on 21 analysts polled by TipRanks in the last 3 months, 6 rate a Buy on CMG, 9 maintain a Hold, while 6 issue a Sell. The 12-month average price target stands at $389.82, marking a nearly 5% downside from where the stock is currently trading.