Shares of Chipotle Mexican Grill Inc fell a lot more than 6 per cent in morning trading on Wednesday, each day after the popular burrito chain operator said hello would temporarily shut a Massachusetts restaurant after four employees fell sick.
Chipotle is trying to correct its reputation after a number of food-safety incidents, including two E.Coli outbreaks that sickened about 50 individuals 10 states and 2 separate norovirus outbreaks in Massachusetts and California.
“We suspect that investors and consumers will be sensitive to this announcement, specifically in light of the adverse news flow during the last 6 months at Chipotle,” CRT Capital analyst Lynne Collier said in note to clients.
“The publicity around this news announcement is going to be another negative data-point that could affect consumer demand.”
Chipotle’s sales have fallen sharply since the E. Coli outbreaks late this past year. Sales within the quarter ended Jan. 31 were down 18 percent compared with the 3rd quarter.
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The restaurant hit by the latest food scare, within the capital of scotland- Billerica, outside Boston, was closed for any full cleaning, company spokesman Chris Arnold said .
The company and the Massachusetts Department of Public Health asserted no customers maintained to become sick.
“This really is under investigation by local health department,” Massachusetts DPH spokesman Scott Zoback said by email.
Chipotle didn’t immediately respond to requests for comment or more information on Wednesday.
The company temporarily closed all its U.S. restaurants on Feb. 8 during prime lunchtime hours to hold staff meetings on food safety.
Up to Tuesday’s close of US$524.69, the company’s stock had fallen about 18 percent since the first E.coli outbreak was reported on Oct. 31.
? Thomson Reuters 2016
