Crista Huff

While perusing headlines, I came across this from Baby's Death Spurs Investigation into Formula Contamination.  "State and U.S. health officials are racing to find the source of contamination after one newborn died and another became ill from bacteria that may be linked to the use of baby formula."

Ouch!  Not something any parent wants to hear, nor any stockholder.  God bless the grief-stricken families, and may experts quickly determine the exact source of the bacteria.

One possible source of the bacteria is Enfamil Newborn formula, manufactured by Mead Johnson Nutrition Company (MJN).  While I want to stress that there could be any number of other possible sources of the bacteria, Mead Johnson's stock is plummeting, and there are shareholders who are wondering what to do.

In a Dec. 22 research note, Citi Investment Research and Analysis reports, "We have spoken to Mead Johnson management following our note earlier regarding Wal-Mart's recall of a batch of Enfamil Newborn powder formula due to the death of a 10 day old infant from Missouri who had contracted Cronobacter bacteria.  At this point, management believes that its Enfamil Newborn product is safe, as well as the overall Enfamil product line, as plant tests at the Zeeland Michigan facility (all of MJN's U.S. Enfamil powder is produced here), are constant and ongoing, with none of the results revealing contamination by this bacterium.  Thus, it seems less likely that the issue originated at the plant and it remains possible that this tragic incident has nothing to do with Enfamil.  With that said, Mead Johnson is rechecking the old product samples, as is the FDA."

Enfamil Newborn formula is a well-known mother's milk substitute.  Non-breastfeeding infants consume formula relatively exclusively during their first few months of life.  They are introduced to solid foods during their first year, but otherwise doctors generally recommend no other beverage aside from mother's milk, infant formula and water during the first year.

Crista Huff

Crista Huff is a retired stockbroker from a NYSE member investment firm. She writes about market-timing at Goodfellow LLC and is active politically.
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