It’s been about a week since Pershing Square’s 13D filing that indicated a nearly 10% stake in Chipotle Mexican Grill, the struggling fast casual dining chain, and analysts have had time to dive in more fully. Deutsche Bank analysts said initially after the filing that they didn’t see a compelling opportunity around refranchising or leverage, and after deeper analysis, they stand by that view.

Chipotle Mexican Grill

What would Chipotle Mexican Grill look like if franchised?

Analyst Jason West said in a report dated September 13 that he doesn’t see much value accretion in a franchising model for Chipotle Mexican Grill “under most reasonable scenarios.” He sees the company’s run-rate margins as too high compared to the roughly 5% royalty rate, which knocks out the franchising viewpoint. On the topic of leverage, he believes the valuation is just too high in order for there to be “sufficiently accretive buybacks” from proceeds or leverage.

West calculated about $5 per share in earnings under a 95% franchised model with a leverage of six times. He explained that this is far below his current estimate of $10.49 per share in earnings for 2017. On the other hand, if Chipotle is able to bring about a recovery in store volumes, the potential earnings accretion would be about $17 per share, he said, in a “reasonable upside case.”

Investors skeptical about whether Ackman can help Chipotle

He estimates that each $100,000 improvement in Chipotle Mexican Grill’s system AUVs could add about $1.50 per share to ongoing earnings. Despite his view that neither franchising nor leverage is the answer to the company’s turnaround efforts, he is interested in hearing Pershing Square’s suggestions for driving higher volumes.

However, he also adds that his conversations with investors suggest that most are skeptical about a turnaround in sales in the near term under the watch of Bill Ackman’s firm. West is bullish on Chipotle even without Ackman’s intervention, as he has an Outperform rating and $500 price target on the stock.

His bullishness stands in spite of his recent brand sentiment survey on the company. He highlighted that sentiment stalled out over the last few months after a rebound between February and April. He noted that this points to sluggish same store sales, and he projects an 18% decline for the third quarter, which is in line with consensus.

“Excellent selling opportunity” for Chipotle Mexican Grill

Stifel analyst Paul Westra and team are among the most bearish on Wall Street when it comes to Chipotle Mexican Grill. On September 9 immediately following the filing from Pershing Square, they “emphatically” reiterated their Sell rating and $215 price target on the fast casual dining chain. They said they can’t “fathom” the firm’s thesis and predicted that the activist effort “is most likely to accelerate and further assure CMG’s ‘tail operational risk’ of increasing management and hourly turnover rates.” These rates are the top factor in the profitability of a restaurant, they explained.

They still believe that in order to justify the company’s current valuation, some combination of two “irrational assumptions” must be made. One is that the economic laws of diminishing returns don’t apply to the Chipotle brand, while the other is that the mathematical laws of discounted cash flow don’t apply to the company’s stock.

Shares of Chipotle Mexican Grill declined by as much as 1.97% to $420.58 during regular trading hours on Tuesday.