We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Chipotle (CMG) Tanks on New Food Contamination Scare
Read MoreHide Full Article
Shares of Chipotle (CMG - Free Report) plummeted 6.82% through early afternoon trading on Tuesday amid news that a Washington, D.C. area location closed this morning after some customers reported norovirus-like symptoms.
Business Insider first reported that the fast-casual Mexican grill closed a Sterling, Virginia location after customers reported symptoms such as vomiting, diarrhea, dehydration, and nausea. The roughly dozen affected Chipotle customers posted their symptoms on iwaspoisoned.com after eating at the restaurant on Friday or Saturday.
Chipotle officials said they were already aware of the small number of illnesses. The company said it is currently working with health authorities to resolve the situation and even plans to reopen the location today after “thorough sanitization.”
"We are working with health authorities to understand what the cause may be and to resolve the situation as quickly as possible," Chipotle executive director of food safety Jim Marsden said in a statement.
"The reported symptoms are consistent with norovirus. Norovirus does not come from our food supply, and it is safe to eat at Chipotle."
The customers who reportedly contracted the norovirus can now count themselves among roughly 20 million Americans who are sickened by this illness every year. According to the Centers for Disease Control and Prevention, norovirus is the leading cause of food-related illness in U.S. – most often caused by contaminated employees who touched food without taking the proper safety precautions.
Can’t Catch A Break
The Denver-based company has fought for the last two years to regain its pre-E.coli outbreak power. Chipotle’s same store sales bounced back a bit in its first quarter after the company spent millions of dollars in marketing and customer giveaways. Last week, the company announced it would begin to test queso dip, new margaritas, and news salads.
Just this morning, Maxim Group analyst Stephen Anderson upgraded Chipotle’s stock to a “Buy” from a “Hold,” and raised its price target price from $440 to $470. The upgrade helped shares of Chipotle gain about 1.1% early Tuesday morning.
What might come as good news for Chipotle investors is that Anderson didn’t back down from his upgrade after today’s norovirus scare.
“We acknowledge [Chipotle] shares are going to be more sensitive than those of peers to health-related restaurant closures, but the norovirus outbreak does not appear to be serious (14 afflicted), nor is there any evidence that the illness has spread beyond that one location,” he said.
However, Chipotle was already a Zacks Rank #4 (Sell) before today’s new setback, which could cause another massive customer retreat. The company also scored an “F” for Value in our Style Score system.
5 Trades Could Profit "Big-League" from Trump PoliciesIf the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report predicting the 7 stocks that will soar highest in the coming month.
Image: Bigstock
Chipotle (CMG) Tanks on New Food Contamination Scare
Shares of Chipotle (CMG - Free Report) plummeted 6.82% through early afternoon trading on Tuesday amid news that a Washington, D.C. area location closed this morning after some customers reported norovirus-like symptoms.
Business Insider first reported that the fast-casual Mexican grill closed a Sterling, Virginia location after customers reported symptoms such as vomiting, diarrhea, dehydration, and nausea. The roughly dozen affected Chipotle customers posted their symptoms on iwaspoisoned.com after eating at the restaurant on Friday or Saturday.
Chipotle officials said they were already aware of the small number of illnesses. The company said it is currently working with health authorities to resolve the situation and even plans to reopen the location today after “thorough sanitization.”
"We are working with health authorities to understand what the cause may be and to resolve the situation as quickly as possible," Chipotle executive director of food safety Jim Marsden said in a statement.
"The reported symptoms are consistent with norovirus. Norovirus does not come from our food supply, and it is safe to eat at Chipotle."
The customers who reportedly contracted the norovirus can now count themselves among roughly 20 million Americans who are sickened by this illness every year. According to the Centers for Disease Control and Prevention, norovirus is the leading cause of food-related illness in U.S. – most often caused by contaminated employees who touched food without taking the proper safety precautions.
Can’t Catch A Break
The Denver-based company has fought for the last two years to regain its pre-E.coli outbreak power. Chipotle’s same store sales bounced back a bit in its first quarter after the company spent millions of dollars in marketing and customer giveaways. Last week, the company announced it would begin to test queso dip, new margaritas, and news salads.
Just this morning, Maxim Group analyst Stephen Anderson upgraded Chipotle’s stock to a “Buy” from a “Hold,” and raised its price target price from $440 to $470. The upgrade helped shares of Chipotle gain about 1.1% early Tuesday morning.
What might come as good news for Chipotle investors is that Anderson didn’t back down from his upgrade after today’s norovirus scare.
“We acknowledge [Chipotle] shares are going to be more sensitive than those of peers to health-related restaurant closures, but the norovirus outbreak does not appear to be serious (14 afflicted), nor is there any evidence that the illness has spread beyond that one location,” he said.
However, Chipotle was already a Zacks Rank #4 (Sell) before today’s new setback, which could cause another massive customer retreat. The company also scored an “F” for Value in our Style Score system.
5 Trades Could Profit "Big-League" from Trump PoliciesIf the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>