06 December 2006

Scapegoating the green onions

Taco Bell is attempting to shift the focus away from the "processed meat food" in their gorditas and chalupas, and, according to Reuters, blaming green onions for the E. coli scare.

Taco Bell, a unit of Yum Brands Inc. (YUM.N: Quote, Profile , Research), said preliminary tests showed three samples of green onions were found to be "presumptive positive" for the E.coli 0157:H7 strain. Tests were not yet conclusive, the company said.

Amazing. I never would have suspected one of the few fresh ingredients on the Bell menu would make so many people sick.

On the YUM stock front, I noticed yesterday that the opportunity to buy on the bad news was a very brief one. Within ten minutes of the open, YUM dropped from about $61.60 to $60.98 before shooting up to the $63.25 range. YUM couldn't have picked a better time to release news that it was doubling its dividend.

However, the Great Green Onion Scare of '06 has pushed YUM back down to $62 as I write this.

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