Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.

McDonald’s Corporation (NYSE: MCD) faces a major health crisis and market backlash after the Centers for Disease Control and Prevention (CDC) reported Tuesday that one person has died and 49 others have fallen ill in a multistate E. coli outbreak linked to its Quarter Pounder sandwiches. The outbreak, concentrated primarily in Colorado and Nebraska, has resulted in 10 hospitalizations, including a child who developed hemolytic uremic syndrome, a serious kidney complication.

CDC Reports Silvered Opinions from a Single Supplier as Likely Source of Contamination

The CDC’s investigation identified slivered onions from a single supplier serving three distribution centers as the likely source of contamination. In response, McDonald’s has halted the use of these onions and quarter-pound beef patties in multiple states, including Colorado, Kansas, Utah, Wyoming, and portions of eight other states. While the company works to replenish its Quarter Pounder supply chain, it emphasized that other menu items, including popular offerings like the Big Mac and regular cheeseburgers, remain unaffected and available for purchase.

The CDC describes the investigation as “fast-moving” and warns that the outbreak may extend beyond the currently identified states. Health officials advise anyone experiencing symptoms such as severe stomach cramps, diarrhea, fever, or vomiting after consuming a Quarter Pounder to seek immediate medical attention, noting that while most people recover within a week, some cases can develop serious complications requiring hospitalization.

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E. Coli Outbreak Linked to McDonald’s Sends Stock Tumbling in Premarket

The outbreak has dealt a significant blow to McDonald’s stock performance and market standing. In pre-market trading Wednesday, shares of the fast-food giant plunged 6.73% to $293.50, marking a sharp decline from the previous day’s close of $314.69. The sell-off came amid heavy trading volume as multiple Wall Street analysts downgraded their ratings on the stock.

The market reaction reflects growing investor concerns despite McDonald’s strong financial fundamentals, including a healthy profit margin of 32.25% and annual revenue of $25.76B. While the company has posted a year-to-date return of 8.05%, this performance lags significantly behind the S&P 500’s 22.67% gain. Analyst price targets for McDonald’s now range from $257.00 to $365.00.

Disclaimer: The author does not hold or have a position in any securities discussed in the article.