Chipotle stock falls on potential Minnesota salmonella link
Chipotle shares fell as the chain removed jalapeños amid a Minnesota salmonella investigation, though officials said no ongoing risk remained at its restaurants.
By Jordan Bell · Startups & Deals Reporter
· 3 min read
Chipotle shares fell roughly 7% to 9% in Tuesday afternoon trading on Aug. 4 after the chain pulled jalapeños from Minnesota restaurants during a salmonella investigation. For investors following the Chipotle Minnesota salmonella investigation, the key distinction is that officials have not concluded Chipotle caused the illnesses.
Chipotle said jalapeños from a common lot were a potential shared ingredient in a possible supply-chain outbreak affecting several food-service retailers. The company said it removed the peppers from every restaurant that received them and replaced them with jalapeños from different growers.
Reuters reported Chipotle shares were down about 7% that afternoon. CBS News reported the stock down $3.28, or 8.8%, to $34.18, while Forbes and Barron's put the intraday decline near 9% at points during the session. Those figures reflect trading at different times, rather than a reported closing price.
What did Minnesota's salmonella investigation find?
Minnesota health officials had identified 110 Salmonella Javiana cases connected to the outbreak, CBS News and The Wall Street Journal reported. Of 84 people interviewed, 75, or 89%, said they had eaten at Chipotle between June 14 and July 14. Most of those meals occurred between June 24 and July 2, according to CBS.
People who did not report eating at Chipotle said they had eaten at other Mexican-style restaurants, the Journal reported. That finding is consistent with investigators examining a possible shared food item, rather than identifying Chipotle as the confirmed origin of the outbreak.
A supply-chain outbreak, in this context, means a possible common ingredient supplied to more than one food-service business is under investigation. Chipotle said its ingredient-traceability system, which tracks where products were distributed, helped it identify the jalapeños as a potential common ingredient.
State officials said Chipotle provided records and cooperated with the investigation. Carlota Medus, a senior epidemiologist supervisor at the Minnesota Department of Health, told CBS that the agency had no ongoing concerns about Chipotle after the company’s actions. She also said contaminated food could have been served elsewhere and the number of identified cases could rise as public-health surveillance finds illnesses that occurred weeks earlier.
Why did Chipotle shares react so sharply?
The market move showed how quickly food-safety news can affect a restaurant stock, even when the investigation has not reached a final conclusion. CNBC reported that Chipotle was implicated in at least five separate foodborne-illness outbreaks from 2015 through 2018, a history that leaves investors especially alert to new reports involving the chain.
The current inquiry remains narrower: Chipotle described jalapeños as a potential ingredient link, removed the product from affected restaurants and said it was working with authorities. Minnesota officials’ statement that there was no ongoing concern at Chipotle does not resolve the broader investigation into where contaminated food may have been served.
This story draws on original reporting from CNBC.
