Shares of Chipotle Mexican Grill (CMG) are on the rise after the company announced that Brian Niccol, who recently served as CEO of Yum! Brands’ (YUM) Taco Bell unit, will succeed Steve Ells as its chief executive. While some Wall Street analysts argued that the announcement will remove uncertainty around Chipotle, not all were bullish this morning as they see challenges remaining for the burrito chain.

NEW CEO: Commenting on the news, Credit Suisse analyst Jason West told investors he believes Brian Niccol’s primary focus will be repairing Chipotle’s image, particularly with younger consumers, and attempting to restore historical sales volumes. The turnaround effort is likely to involve brand rebuilding, innovation, operational improvements, digital upgrades, and potential day part expansion, he contended. West reiterated a Neutral rating and $275 price target on Chipotle’s shares given the challenges ahead and already elevated valuation. Meanwhile, Piper Jaffray analyst Nicole Miller Regan told investors in a research note of her own that she believes the announcement removes uncertainty around Chipotle, while reiterating her stance that meaningful leverage exists when the recovery plays out. The analyst is a buyer of Chipotle shares, keeping an Overweight rating and $318 price target on the stock. SunTrust analyst Jake Bartlett also commented on the news, saying Chipotle’s appointment of Niccol adds to his confidence that services initiatives will be “both aggressive and effective”, producing an acceleration in same-store sales growth. Bartlett also noted he expects the new CEO to focus on marketing, helping win back the lapsed users. The analyst reiterated a Buy rating and $340 price target on the name.

CHALLENGES REMAIN: Not as bullish, Deutsche Bank analyst Brett Levy said he applauds the hire, but cautions investors from becoming overly optimistic given Chipotle’s ongoing challenges. Highlighting the company’s sluggish fundamentals, its strategic uncertainty and a premium valuation, the analyst reiterated a Sell rating on Chipotle’s shares. His peer at Stifel also voiced a similar opinion. Analyst Chris O’Cull said that while he is encouraged by Chipotle’s decision to hire Brian Niccol, he remains concerned sales and margin recovery will fall short of Street expectations given the operational and competitive challenges the company needs to overcome. The analyst reiterated a Sell rating and $250 price target on the shares. Meanwhile, UBS analyst Dennis Geiger acknowledged that Chipotle’s new CEO may be viewed as a near-term catalyst for the stock given his experience repositioning the Taco Bell brand. However, Geiger told investors that he continues to believe long-term headwinds remain, which will take time to address, while valuation remains elevated. The analyst reiterated a Sell rating and $275 price target on Chipotle’s shares.