Out of flavor: Wall Street slashes targets on Chipotle
(Reuters) - From the carnitas crisis of early 2015 to the more recent E. Coli outbreak. And now, tough love from Wall Street. Chipotle Mexican Grill Inc's (CMG.N: Quote) shareholders have never had it so bad.
At least six brokerages slashed their price targets on the burrito chain operator's stock on Thursday, a day after the company said it was served with a grand jury subpoena related to a probe into a norovirus incident at one of its restaurants.
Chipotle's stock, once a Wall Street darling, has lost a third of its value since the end of October, when an E. Coli outbreak linked to its restaurants was first reported.
The shares were down 1.6 percent at $420.02 on Thursday.
Chipotle's announcement on Wednesday highlighted deepening problems at the chain, which has been plagued by a spate of food-borne illnesses among other issues since October.
Last year started on a sour note, when the company said it would not serve its popular "carnitas" at some restaurants after it found that a key supplier was not complying with its animal-welfare standards.
BTIG analysts on Thursday cut their price target by $134 to $530 and said the consistent negative news flow was keeping investors on the sidelines.
Analysts at Deutsche Bank, who cut their price target to $400 from $480, said until Chipotle identified the source of the outbreak, fundamentals would continue to remain challenged.
Barclays cut its target to $465 from $540. Continued...