International fast food giant McDonald's Corp. (MCD, Financial) reported earnings that beat analyst estimates thanks to strong U.S. comparable sales growth on Thursday.
In its first-quarter report, the company revealed revenue of $5.12 billion that surpassed Refinitiv estimates placing revenue at $5.03 billion. Adjusted earnings per share of $1.92 also beat analyst estimates of $1.81.
"Our first quarter 2021 global comparable sales and revenues surpassed first quarter 2019 levels, even as resurgences and operating restrictions persist in many parts of the world. I continue to be inspired by the resilience of our crew members, franchisees, supplies, and company employees as we lead with our values and stay true to our purpose of feeding and fostering communities," McDonald's President and CEO Chris Kempczinski said. "Our teams around the world are focused on executing our Accelerating the Arches strategy at the highest level - we're maximizing our marketing in a culturally relevant way, committed to the great tasting customer favorites on our core menu and doubling-down on digital, delivery and drive thru to create a faster and easier customer experience."
The company saw positive quarterly comparable sales results across all segments. However, guest counts remained negative for all segments according to the company's report.
Comparable sales grew the most in the U.S., showing a 13.6% increase compared to the same quarter of 2020. The region saw average check growth with double-digit, positive comparable sales across all dayparts. Strong national menu and marketing offerings were credited towards the comparable sales growth alongside growth in delivery and digital platforms.
International markets also saw positive comparable growth coming from the U.K., Australia and Canada that were offset by negative results in France and Germany. McDonald's cited varying levels of government restrictions on restaurants as a major factor to negative results.
The report also highlighted consolidated operating income increasing 35% that included $135 million of strategic gains related to the sale of McDonald's Japan stock.
On April 29, the stock was trading at $235.46 per share, up 1.31%, with a market cap of $175.29 billion. The shares are trading at a modestly overvalued rating according to the GF Value Line.
Top gurus invested in McDonald's include the T Rowe Price Equity Income Fund (Trades, Portfolio), Ken Fisher (Trades, Portfolio), Mario Gabelli (Trades, Portfolio) and First Pacific Advisors (Trades, Portfolio).
Disclosure: Author owns no stocks mentioned.
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