Chipotle (CMG) shares are looking sickly after 43 of the chain’s restaurants in Seattle and Portland were closed following an e-coli outbreak. It’s the third instance of food contamination at Chipotle restaurants which has required serious action since August. With Chipotle shares already under pressure after concerns of slowing growth, can the stock price bounce back? Morning Star Analyst RJ Hottovy told TheStreet that: ‘while details are sparse and the investigation is ongoing, we believe this was an isolated event affecting a handful of locations and not indicative of structural supply chain issues at Chipotle,’ adding that: ‘we believe continued pressure on the stock could open up an opportunity for longer-horizon investors.’ The closed restaurants represent just over two percent of Chipotle’s restaurant locations but the chain has not yet disclosed if others will be added and how long closures will last. Chipotle was forced to switch tomato suppliers back in September following a Salmonella outbreak and pulled ‘carnitas’ from a third of its restaurants this year after one of its pork suppliers failed to meet the company’s ‘food with integrity’ standards.
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