More E. coli cases plague Chipotle Mexican Grill Inc.

Shares of Chipotle dropped 3.5 percent, or $19.07, to close at $522.01. The findings came after both of the company's chief executives stated that no E. coli cases were contracted by customers eating at stores after early November.

The U.S. Food and Drug Administration said on Tuesday it is investigating the more recent outbreak of a rare strain of E.coli linked to Chipotle Mexican Grill Inc. The company has estimated that sales will fall as much as 11 percent in the fourth quarter as the illnesses bring attention to the company's food-safety struggles.

Taylor Farms officials cited that report as the all clear for their products even though FDA officials said there could have been undetected pathogens in the fresh-cut mix. "Because it is not known if these infections are related to the larger, previously reported outbreak of STEC O26 infections, these illnesses are not being included in the case count for that outbreak", the CDC noted. Two people from Kansas and North Dakota dined at the same Chipotle restaurant in Kansas, and three others dined at the same Chipotle restaurant in Oklahoma.

"I will say though, that we can assure you today that there is no E. coli in Chipotle", founder and co-CEO Steve Ells told CNBC last week.

The CDC released information about the new illnesses as part of an update on the wider outbreak.

Mansour Samadpour, head of IEH Laboratories, said after the restaurants reopened that the new procedures made Chipotle an industry leader. With all of these programs in place, we are confident that we can achieve a level of food safety risk that is near zero.

 

The C.D.C.is investigating a more recent E. coli outbreak linked to the burrito chain that caused five illnesses in three states. The analyst, who views the CDC's "strong allusion" that these new cases are "probably unrelated" to the prior outbreak as "very surprising and disappointing", now believes the consensus forecasts for Chipotle's earnings in fiscal 2016 and 2017 are "far too high" given that the news flow shows the impact of the company's health issues continuing. The restaurant chain hired IEH Laboratories & Consulting Group to help refine its procedures. The safety program will involve DNA testing of all fresh produce and end-of-shelf-life testing to ensure that ingredients are safe to consume.

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