SAN FRANCISCO, Jan 13 (Reuters) - Embattled shares of Chipotle Mexican Grill jumped 6 percent on Wednesday and were on their way to their strongest session since outbreaks of E. coli and other illnesses at its restaurants unnerved customers and investors.
The burrito chain has been under scrutiny for months over outbreaks of foodborne illness linked to its restaurants across several U.S. states and new data showed short investors’ bets against the company rose to their highest level since 2013.
The bounce in Chipotle’s stock, which has slumped over 40 percent since mid-October, came ahead of a presentation by company executives at the ICR Conference in Orlando, Florida, scheduled for 1:30 p.m. ET (1830 GMT).
In morning trade, the stock was up 6.2 percent at $429.25. The reason the gain, which would be the largest since July if it closes at current levels, was not immediately clear.
However, Tiburon Research Group founder Rob Wilson sent several tweets indicating that, ahead of the company’s scheduled presentation, Chipotle executives had held breakout sessions with analysts and discussed topics including share buybacks and progress dealing with the foodborn-illness crisis.
Short interest in Chipotle grew to 8.2 percent of outstanding shares at the end of December from 7.3 percent in mid-December, according to Nasdaq data. Two months ago, short interest was half that level.
Last week, the company was served with a subpoena in a federal criminal probe linked to norovirus cases in California in 2015. It was also sued for allegedly misleading investors about its food safety controls.
Reporting by Noel Randewich; Editing by Alan Crosby