Tuesday, November 3, 2015

Chipotle Shares Affected By E. Coli Outbreak by Ira Riklis

Ira Riklis looks at the health outbreaks like the E. Coli outbreak that has caused the restaurant chain to close some restaurants causing its shares to drop.

Chipotle is a Mexican grill restaurant that specializes in Burritos and Tacos. It has branches all over
Chipotle Mexican Grill Sign
the United States of America, Canada Germany and the United Kingdom. It has been operating for a little over two decades now. In the recently however, you might have read about outbreaks that have threatened the continued operations of these restaurant chains.

Health Scares Under Investigations

In September 2015, there was an outbreak of Salmonella in Minnesota. The outbreak was linked to victims who had had a meal at some of the Chipotle restaurants that are in Minnesota. According to reports, there were at least 45 people who had fallen ill after they had consumed some food from the Chipotle food outlet. Further investigations revealed that 32 out of 34 of those who fell sick had eaten at Chipotles in Rochester or St. Cloud.

 Investigators with the Minnesota Health Department believed strongly that the source of the outbreak could have been in one of the products that were used to prepare meals at Chipotle. That was later confirmed when they found out that the tomatoes that were served at the restaurants were responsible for the outbreak.

Recent E. Coli Outbreaks

For the third time this year, Chipotle is on the receiving end of criticism after an E. Coli outbreak that has been linked to them again. Several news outlets have reported that some of the Chipotle Restaurants in Washington and Oregon were shut down pending investigations as to the cause of the E. Coli outbreak in these restaurants. The number of those who have fallen ill due to the E. Coli in Western Washington was at 19 with about 7 of those having been hospitalized in the past few days. The number is expected to rise even further according to health officials in these regions.

 Investigations are still going on, and everyone who has the symptoms of E. Coli is being urged to go to the health officials to get tested. That is going to help in gathering more clues as to what might be causing this outbreak. If you know someone who has some of the following symptoms severe stomach cramps, diarrhea that is often bloody, vomiting and slight fever if present at all, you better advise them to visit the nearest hospital to get tested for the E. Coli bacteria.

Shares Facing A Downward Spiral

As you can expect from such a scenario, the shares of this franchise have fallen following the outbreaks and the subsequent closure of some of the branches.

To put it into perspective, here are some figures; from a recent week, Chipotle dropped by 2.5% to close at $624 which meant that they have lost about half a billion dollars of their market value. And before that, they had dropped by 6.5% throughout the year. This is a blow that is bound to make even the mightiest of corporations to shutter a little bit.

This Mexican food restaurant is experiencing slow growth at the moment, and the company spokesperson has been reported saying that the turnover in the recent past has been "choppy". Now with about 47 of their restaurants closed until further notice, you can only imagine what is going to happen to the shares if the situation persists for long.

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