Loop Capital analyst Alton Stump has adjusted his stance on McDonald's (MCD, Financial), moving the rating from Buy to Hold. The price target for MCD has been revised downward to $315 from a previous $346. This change reflects a more cautious outlook on the stock's future performance.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 29 analysts, the average target price for McDonald's Corp (MCD, Financial) is $336.69 with a high estimate of $364.00 and a low estimate of $300.00. The average target implies an upside of 8.97% from the current price of $308.98. More detailed estimate data can be found on the McDonald's Corp (MCD) Forecast page.
Based on the consensus recommendation from 38 brokerage firms, McDonald's Corp's (MCD, Financial) average brokerage recommendation is currently 2.2, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for McDonald's Corp (MCD, Financial) in one year is $317.30, suggesting a upside of 2.69% from the current price of $308.98. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the McDonald's Corp (MCD) Summary page.
MCD Key Business Developments
Release Date: May 01, 2025
- Global Comp Sales: Declined by 1% in the first quarter.
- US Comp Sales: Declined 3.6% due to broad-based consumer challenges.
- Adjusted Earnings Per Share: $2.67 for the quarter, a 1% increase in constant currencies.
- Restaurant Margins: Generated over $3.3 billion for the quarter.
- Adjusted Operating Margin: Approximately 45.5%.
- International Developmental Licensed Markets Comp Sales: Increased by 3.5%, driven by positive results in the Middle East and Japan.
- Foreign Currency Translation Impact: $0.04 headwind on earnings per share.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- McDonald's Corp (MCD, Financial) has launched a new McValue platform in the US, which includes a $5 meal deal that has resonated well with customers.
- The company has introduced exciting new menu items, such as McCrispy Chicken Strips, which are expected to drive growth.
- McDonald's Corp (MCD) has achieved all-time high customer satisfaction scores in the US, indicating strong operational execution.
- The Minecraft movie marketing campaign was a success, with collectibles selling out faster than anticipated, demonstrating effective promotional strategies.
- The company is focusing on beverages as a growth area, with plans to expand its offerings and capture a larger share of the profit pool in this category.
Negative Points
- Global comp sales declined by 1% in the first quarter, with a 3.6% decline in the US, reflecting broad-based consumer challenges.
- Traffic from low- and middle-income consumers in the US has significantly decreased, indicating economic pressures on these cohorts.
- The UK market is not yet gaining share, and execution improvements are needed to address this issue.
- The company faces a more inflationary environment in Europe, particularly due to beef prices, which impacts profitability.
- Despite the success of the McValue platform, the buy-one-add-one-for-a-dollar component is not driving as much incrementality as expected.
