Investors in Chipotle Mexican Grill, Inc.
While investors are hoping that the news will quickly blow over, customers lit up social media in disgust over the company's handling of store cleanliness. According to twitter data companies, since news of the most recent restaurant closure broke, Twitter mentions of Chipotle have doubled. Sites like StockTwits, a popular site for investors to tweet about public companies and the markets, have shown that the sentiment of those tweets has also turned distinctly negative.
Prior to the news, investors had all but forgotten about the recent e coli news that hit the company late last year. Since the beginning of year Chipotle has outperformed the markets gaining almost 5%. Just this month alone the company shares gained over 14% with numerous analyst notes that the "smoke has cleared" and "we see nothing but upside from here".
So what is the company to do? Well the first step is to work on re-building Chipotle's reputation. The obvious fix would be to stop the seemingly endless stream of negative headlines, a phase that can't come quickly enough for shareholders. To do this they need to convince customers and shareholders that they have tightened up their in-store procedures for cleanliness and food handling. Time will tell if they can do this but I don't think offering free burritos this time will fix the problem.