Chipotle is getting slammed

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Chipotle Stock Down After Slashing Guidance on E. Coli News

Chipotle shares are under pressure on Monday morning.

After the market close on Friday, the company issued a regulatory filing stating that it was expecting an 8% to 11% drop in comparable sales in the fourth quarter.

This followed news earlier in the day that, once again, the US Centers for Disease Control and Prevention (CDC) was investigating new E. coli cases linked to the fast-food chain.

Year-to-date, the stock was down about 22%.

In the filing, Chipotle said sales fell by about 22% in the days after the CDC earlier announced new E. coli cases linked to the restaurant.

Learn more about foods that have caused past outbreaks:

Risky foods to eat, food-borne illnesses
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Chipotle is getting slammed
In this Aug. 16, 2007 file photo, a worker harvests romaine lettuce in Salinas, Calif. Leafy green vegetables were the leading source of food poisoning over an 11-year period, federal health officials say, Tuesday, Jan. 29, 2013. However, the most food-related deaths were from contaminated chicken and other poultry. (AP Photo/Paul Sakuma, File)
Salmonella can enter tomatoes through cracks and bruises in the fruit's skin. (Photo via Getty Images)
Raw fish, like in sushi and sashimi, carries a risk of salmonella. (Photo via Getty Images)
Fermented foods such as soy sauce can be a breeding ground for flies if they are not covered properly. (Photo via Getty Images)
Raw or undercooked eggs are linked to salmonella. (Photo by Russel Wasserfall, Getty Images)
Many wild mushrooms are poisonous to humans; be cautious of where you get them from. (Photo by Adam Gault, Getty Images)
The seeds of many fruits contain toxins that can be poisonous if consumed. (Photo via Tetra Images/Getty Images)
Oysters have been linked to several illness outbreaks, as they are often consumed raw and can carry any viruses from the water they were in. (Photo via Getty Images)
Soft cheeses, like brie and feta, can carry listeria. (Photo via Getty Images)
Sprouts require humid conditions to grow, which can also spur bacteria growth. (Photo by Tom Grill via Getty Images)

Analyst commentary

In a note, RBC analysts lowered their price target on the stock to $575 from $825, while maintaining their "Outperform" rating on the stock, as they expect some sales recovery in the second half of 2016.

BTIG analysts also maintained their "Buy" rating. "We do not believe there will be any longer-term impact to the brand or its customer appeal and expect Chipotle's growth trajectory to remain intact," Peter Saleh and Ben Parente wrote in a note.

And writing to clients, Barclays' Jeffrey Bernstein said the E. coli news was more damaging for Chipotle than other restaurants with prior investigations because of its focus on 'Food with Integrity'.

"While we continue to believe CMG the best growth story in restaurants (of size & scale), we previously struggled to recommend based on the lack of visibility on a comp reacceleration entering '16," Bernstein wrote. "And now with ongoing headlines to further pressure near-term results, we remain cautious."

Here's a chart showing the drop in shares and the move higher:

chipotle e. coli outbreak

Chipotle Mexican Grill Facebook

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