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Chipotle Mexican (CMG) Adds Chorizo Spicy Chicken to Menu

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Chipotle Mexican Grill (CMG - Free Report) is introducing “chorizo” a mix of spicy pork and chicken in some of its restaurants in select cities. The offering proved to be popular among guests when it was tested last year.

The new addition to the menu has been made available at select stores from Jun 29. Currently, only six of its restaurants are serving this special item to guests. Columbus, New York City, Sacramento, San Diego, Denver and Dulles are the chosen locations for Chipotle’s initial launch of “chorizo”.

The company’s first-quarter 2016 revenues were marred by negative publicity surrounding the E. coli and norovirus outbreaks in many states, which began toward the end of 2015.

Traffic was severely hurt following the news about the outbreak in Oregon and Washington. Naturally, as a safety measure, the fast casual chain was forced to close several outlets. Although these were reopened later with fresh ingredients, and after deep cleaning and sanitizing, the incidents dealt a severe blow to Chipotle’s sales.

The fact that Chipotle uses only healthy ingredients has long been its marketing strength and attracted customers despite its comparatively high prices. However, with the negative publicity associated with the E. coli outbreak, Chipotle has fallen out of favor with health-conscious diners. So it is leaving no stone unturned to lure customers back to its restaurants.

The launch of “chorizo” is another step in this direction. Previously, the company had given away free burritos as a promotional offer.

Chipotle currently has a Zacks Rank #4 (Sell).

Stocks to Consider

Investors interested in the restaurant industry can also consider Famous Dave's of America Inc. (DAVE - Free Report) , Dave & Buster's Entertainment, Inc. (PLAY - Free Report) , and Carrols Restaurant Group, Inc. (TAST - Free Report) . All of them sport a Zacks Rank #1 (Strong Buy).

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