Back to top

Image: Bigstock

McDonald's (MCD) Stock Moves -0.5%: What You Should Know

Read MoreHide Full Article

In the latest market close, McDonald's (MCD - Free Report) reached $302.98, with a -0.5% movement compared to the previous day. This move was narrower than the S&P 500's daily loss of 0.93%. Elsewhere, the Dow lost 0.41%, while the tech-heavy Nasdaq lost 1.53%.

Heading into today, shares of the world's biggest hamburger chain had gained 5.49% over the past month, lagging the Retail-Wholesale sector's gain of 5.61% and outpacing the S&P 500's gain of 2.17% in that time.

Investors will be eagerly watching for the performance of McDonald's in its upcoming earnings disclosure. On that day, McDonald's is projected to report earnings of $3.15 per share, which would represent a year-over-year decline of 1.25%. Meanwhile, our latest consensus estimate is calling for revenue of $6.76 billion, up 1.04% from the prior-year quarter.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $11.71 per share and a revenue of $26.04 billion, representing changes of -1.93% and +2.15%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for McDonald's. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.38% higher. McDonald's currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, McDonald's is holding a Forward P/E ratio of 26. This expresses a premium compared to the average Forward P/E of 22.17 of its industry.

We can additionally observe that MCD currently boasts a PEG ratio of 4.06. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Restaurants was holding an average PEG ratio of 2.19 at yesterday's closing price.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 166, putting it in the bottom 35% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


McDonald's Corporation (MCD) - free report >>

Published in