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The Zacks Analyst Blog Highlights: TreeHouse Foods, SunOpta, General Mills, Costco Wholesale And Chipotle Mexican Grill

Published 06/06/2016, 09:30 PM
Updated 07/09/2023, 06:31 AM
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For Immediate Release

Chicago, IL – June 07, 2016 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include TreeHouse Foods Inc. (THS), SunOpta Inc. (STKL), General Mills (NYSE:GIS), Inc. (GIS), Costco Wholesale Corp (NASDAQ:COST). ( COST) and Chipotle Mexican Grill (NYSE:CMG), Inc. (CMG).

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Here are highlights from Friday’s Analyst Blog:

Food Industry Hit by Widespread Recalls

The food industry has been facing the brunt of the recent outbreak of bacterial infections caused by potentially lethal bacteria like Listeria monocytogenes and E.coli. Fast food restaurants and food companies are incurring heavy losses from the repeated recalls of their products fearing that they could be contaminated with these bacteria. .

Last week, TreeHouse Foods Inc. (THS) announced the recall of products which are expected to be contaminated by L mono bacteria. A supplier SunOpta Inc. ( STKL) had notified TreeHouse of the possibility of contamination of the products that had been distributed nationwide. The recall is expected to affect revenues significantly for the company.

L mono is known to cause serious infections in children, weak or elderly people. It can be as lethal as to cause miscarriages and stillbirths among pregnant women. However, healthy individuals may suffer only short-term symptoms such as high fever, severe headache, stiffness, nausea, abdominal pain and diarrhea.

General Mills, Inc. (GIS) also announced a voluntary national recall of four specific flavors of its Nature Valley protein chewy bars and Nature Valley simple nut bars on grounds of possible L mono contamination in this week.

Costco Wholesale Corp. (COST) came into news for the wrong reasons after Centers for Disease Control and Prevention (“CDC”) alleged that its rotisserie chicken salad caused E. coli infection in 19 people from the U.S. states of California, Colorado, Missouri, Montana, Utah, Virginia and Washington. The company took its rotisserie chicken salad off the shelves, effective Nov 20. In addition, the retailer stopped further production of the item.

E. coli is commonly found in the intestines of humans and animals, some strains of which can cause severe food poisoning.

Also in November, Chipotle Mexican Grill, Inc. (CMG) had to close 43 outlets in Oregon and Washington as a safety measure after 37 students from Boston College fell ill, most likely after the consumption of E. coli infected food from one of the company’s restaurants. The company enforced stricter guidelines for suppliers in the wake of the latest E. coli outbreak that affected several customers in six U.S. states.

Widespread recalls by food companies are in one way a relief for consumers because it ensures that regulatory authorities are more vigilant. However, negative publicity associated with these outbreaks keep customers away from fast food restaurants.

Chipotle’s first-quarter revenues reported in Apr 2016 took a hit as negative publicity surrounding the E. coli outbreak had dented its sales to a large extent. The E. coli outbreak, has hurt traffic severely for many of its restaurants. Similarly, repeated recalls made by companies like Starbucks (NASDAQ:SBUX) and TreeHouse can hurt the company’s top and bottom line.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.



TREEHOUSE FOODS (THS): Free Stock Analysis Report

SUNOPTA INC (STKL): Free Stock Analysis Report

GENL MILLS (GIS): Free Stock Analysis Report

COSTCO WHOLE CP (COST): Free Stock Analysis Report

CHIPOTLE MEXICN (CMG): Free Stock Analysis Report

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