Shares of Mead Johnson (MJN.N) rose over 5 percent before the bell on Tuesday, after U.S. health officials said on Friday that the company's sealed cans of Enfamil baby formula were clear from a potentially deadly bacteria.
The company has been in trouble after the death of a 10-day-old baby from Missouri because of suspected presence of the Cronobacter bacteria in its Enfamil Newborn product.
"Shares should bounce nicely on this news, but it could take some time for the stock to fully recover," RBC Capital Markets analyst Edward Aaron wrote in a note to clients.
The company's shares, which have lost about 10 percent since its products were pulled off shelves by retailers on December 22, rose to $72.20 in pre-market trade on Tuesday.
The U.S. Food and Drug Administration and the Centers for Disease Control and Prevention said on Friday that the sealed cans of the products were free from the bacteria and a recall was unnecessary.
Cronobacter is a bacteria that has sometimes been linked to rare illnesses in newborns and has been found in milk-based powdered baby formula.
(Reporting by Arpita Mukherjee in Bangalore; Editing by Roshni Menon)