/McDonald)
McDonald's Corporation (MCD), headquartered in Chicago, Illinois, operates and franchises fast food chains under the McDonald's brand. Valued at $225.8 billion by market cap, MCD is the world's largest fast food restaurant chain that offers various food products and soft drinks, and non-alcoholic beverages. With a global presence in over 40,000 locations in more than 100 countries, approximately 95% of its restaurants are owned and operated by independent local business owners. The fast-food giant is expected to announce its fiscal first-quarter earnings for 2025 before the market opens on Thursday, May 1.
Ahead of the event, analysts expect MCD to report a profit of $2.67 per share on a diluted basis, down 1.1% from $2.70 per share in the year-ago quarter. The company beat or matched the consensus estimates in two of the last four quarters while missing the forecast on two other occasions.
For the full year, analysts expect MCD to report EPS of $12.25, up 4.5% from $11.72 in fiscal 2024. Its EPS is expected to rise 8.2% year over year to $13.25 in fiscal 2026.
MCD stock has outperformed the S&P 500’s ($SPX) 6.6% gains over the past 52 weeks, with shares up 17.4% during this period. Similarly, it outperformed the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 8.5% gains over the same time frame.
McDonald's success is largely due to its strong digital ecosystem, specifically its MyMcDonald's Rewards program which has 175 million active users across 60 markets. This platform not only boosts sales but also provides valuable customer data for personalized marketing. McDonald's focus on digital innovation positions it well for continued growth, especially as consumer behavior shifts online. Menu innovations and value offerings like the "$5 Meal Deal" also contribute to driving traffic and addressing affordability concerns for customers.
On Feb. 10, MCD shares closed up more than 4% after reporting its Q4 results. Its adjusted EPS of $2.83 matched Wall Street expectations. The company’s revenue was $6.4 billion, missing Wall Street forecasts of $6.5 billion.
Analysts’ consensus opinion on MCD stock is reasonably bullish, with a “Moderate Buy” rating overall. Out of 35 analysts covering the stock, 20 advise a “Strong Buy” rating, two suggest a “Moderate Buy,” and 13 give a “Hold.” MCD’s average analyst price target is $330.94, indicating a potential upside of 5.9% from the current levels.
