Chipotle Mexican Grill, Inc. CMG 0.19% bulls have little reason for optimism these days when they’re looking at the battered stock’s chart. Last week was a disastrous week for Chipotle both from a fundamental and technical standpoint.
Less than two years after a series of E. coli outbreaks dealt a devastating blow to Chipotle’s reputation and sales numbers, Chipotle was forced to temporarily close a Virginia restaurant due to sick customers. Within days, a video of rats inside a Texas Chipotle location was spreading on social media.
Chipotle’s fragile reputational recovery from its 2015 issues now seems shattered, and the stock’s technical picture is in disarray as well.
Chipotle shares hit an all-time high of $758.61 in late 2015 prior to the E. coli scare. However, they plummeted to as low as $352.96 in late 2016 in the aftermath of the health concerns.
Chipotle showed signs of life in early 2017. Sales appeared to be stabilizing, and company management even felt confident enough to raise food prices at certain locations.
However, the rally stalled at the $500 level, and the recent health issues have Chipotle shares down 12.8 percent in the past week. Chipotle blasted through its 52-week low and potential support level at $352.96.
Now, Chipotle is trading at its lowest level since 2013 with very few potential support levels below.
Chipotle found support at $233 during a steep pullback back in late 2012. Unless $300 can serve as psychological support, there appears to be…
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