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Last summons on Chipotle's quarterly beat



(Reuters) – Chipotle Mexican Grill Inc. announced Thursday that it has received another summons from US attorneys seeking information about an outbreak that sickened hundreds of people in one of its restaurants in Ohio last year have.

Shares of The burrito chain fell 5 percent after being informed, and analysts said they saw a limited valuation, even though the company posted better-than-expected quarterly sales and earnings on Wednesday.

"It's not a new incident, but (the summons) is enough Shake off some of the louder bulls in history," said Maxim Group analyst Stephen Anderson.

Over the last three years, the company had a number of subpoenas related to illnesses that were associated with its restaurants, following an E. coli Salmonella and Norovirus outbreaks in the company's branches in 2015, which resulted in hundreds in several States concerned.

The last subpoena is the fourth and is part of an ongoing criminal investigation. The office was headed by the US Attorney for the Central District of California.

Last August, a species of bacteria found in meat and precooked food at unsafe temperatures was responsible for hundreds of people getting sick in a restaurant in Powell, Ohio

Thursday https://www.sec.gov/Archives/edgar/data/1058090/000105809019000015/cmg-20190331x10q.htm published in a regulatory filing, requested information related to incidents of illness that were related to the restaurants and restaurants in Ohio, California, Massachusetts and Virginia, which were under previous summonses.

Wednesday's results follow Chipotle's efforts to ramp up promotions, add new menu items, and expand delivery options. It also launched a loyalty program to attract customers.

The positive results also prompted the company to raise its full-year revenue growth forecast to a mid to high single-digit rate. Number growth.

"While the company has improved its comp outlook, we believe Chipotle will continue to need double-digit comps to justify the current multiples," said Jeremy Scott, an analyst at Mizuho Securities.

-monthly forward gains, while Yum! Brands trade at 26.07 times and McDonalds trade at 23.74 times.

Analysts also pointed out that higher raw material costs, loyalty reductions, and rising food costs would hurt Chipotle's margins.

Jefferies analyst Andy Barish is well positioned with his initiatives and believes it is still in the early stages of its transition process.

"The rating, however, keeps us on hold (rating)," he added.

(Reporting by Nivedita Balu in Bengaluru, edited by Shailesh Kuber))


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