Yum shares recovering after E. coli-related fall
01.12.2006, 17:04
Shares of Louisville-based Yum! Brands Inc. fell as much as 4 percent Friday morning after an analyst downgraded the stock partly because of the E. coli outbreak at Taco Bell restaurants in the Northeast.
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Wachovia Securities had rated the stock the equivalent of a buy, but knocked it down to a hold Friday morning.
By early afternoon Yum shares had recovered somewhat and were trading at $59.82, down $1.26. For the latest price click here.
In a note to investors, analyst Jeffrey Omohundro said the recent outbreak of E. coli at Taco Bell restaurants in the Northeast could have a “short-term, although potentially significant, negative sales impact.”
Taco Bell announced this week that it would pull green onions, or scallions, from all 5,800 of its U.S. stores as a precautionary measure after customers in New York, New Jersey and Pennsylvania became sick after eating at Taco Bell restaurants.
Wachovia also is “increasingly concerned” about slowing momentum at Yum’s domestic fast-food businesses, including KFC, Taco Bell and Pizza Hut.