Zacks Investment Research cut shares of McDonald's (NYSE:MCD) from a buy rating to a hold rating in a research note released on Wednesday morning.
According to Zacks, “McDonald’s shares outpaced the industry in the past year. Notably, growing guest count remains McDonald’s top priority and it is undertaking various sales and digital initiatives to this end. As a result, Q4 marked the fourth consecutive quarter of comparable guest count growth for the company. Increased focus on delivery, enhancement of digital capabilities, and accelerated deployment of Experience of the Future restaurants in the United States will drive growth. In fact, global comps at McDonald’s have been positive over the past nine quarters. Meanwhile, augmented focus on refranchising will cut the company’s capital requirements and facilitate EPS growth and ROE expansion in the long run. Yet, higher costs along with currency headwinds may hurt profits. Also, a soft industry backdrop in the United States and macroeconomic concerns in some parts of the world might limit sales growth.”
A number of other equities research analysts have also recently issued reports on MCD. Goldman Sachs Group set a $173.00 price target on shares of McDonald's and gave the company a buy rating in a report on Wednesday, November 8th. ValuEngine cut shares of McDonald's from a buy rating to a hold rating in a report on Friday, December 1st. Jefferies Group upgraded shares of McDonald's from a hold rating to a buy rating and upped their price target for the company from $150.00 to $200.00 in a report on Tuesday, December 5th. Barclays set a $193.00 price objective on shares of McDonald's and gave the company a buy rating in a research report on Friday, December 8th. Finally, Piper Jaffray Companies upped their price objective on shares of McDonald's from $175.00 to $185.00 and gave the company an overweight rating in a research report on Thursday, December 14th. Nine analysts have rated the stock with a hold rating and twenty-five have issued a buy rating to the company’s stock. The company currently has an average rating of Buy and a consensus price target of $183.08.
McDonald's (NYSE:MCD) last released its quarterly earnings results on Tuesday, January 30th. The fast-food giant reported $1.71 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $1.59 by $0.12. McDonald's had a net margin of 22.75% and a negative return on equity of 201.76%. The company had revenue of $5.34 billion during the quarter, compared to analysts’ expectations of $5.22 billion. During the same period in the prior year, the company earned $1.44 earnings per share. The business’s quarterly revenue was down 11.4% compared to the same quarter last year. equities research analysts predict that McDonald's will post 7.63 EPS for the current fiscal year.
The firm also recently declared a quarterly dividend, which will be paid on Thursday, March 15th. Investors of record on Thursday, March 1st will be given a $1.01 dividend. This represents a $4.04 annualized dividend and a yield of 2.57%. The ex-dividend date is Wednesday, February 28th. McDonald's’s dividend payout ratio (DPR) is presently 63.52%.
In other news, VP Catherine A. Hoovel sold 1,398 shares of the firm’s stock in a transaction that occurred on Wednesday, January 31st. The shares were sold at an average price of $170.54, for a total transaction of $238,414.92. Following the completion of the sale, the vice president now owns 1,398 shares of the company’s stock, valued at $238,414.92. The transaction was disclosed in a document filed with the SEC, which is accessible through this link. Also, insider Douglas M. Goare sold 34,575 shares of the firm’s stock in a transaction that occurred on Wednesday, January 31st. The stock was sold at an average price of $173.53, for a total transaction of $5,999,799.75. The disclosure for this sale can be found here. Corporate insiders own 0.24% of the company’s stock.
Several hedge funds and other institutional investors have recently bought and sold shares of the company. Vanguard Group Inc. grew its stake in shares of McDonald's by 1.6% during the second quarter. Vanguard Group Inc. now owns 57,300,686 shares of the fast-food giant’s stock valued at $8,776,174,000 after purchasing an additional 906,303 shares during the last quarter. BlackRock Inc. grew its stake in shares of McDonald's by 0.9% during the fourth quarter. BlackRock Inc. now owns 55,535,177 shares of the fast-food giant’s stock valued at $9,558,713,000 after purchasing an additional 481,739 shares during the last quarter. Capital World Investors grew its stake in shares of McDonald's by 2.8% during the second quarter. Capital World Investors now owns 22,288,104 shares of the fast-food giant’s stock valued at $3,413,646,000 after purchasing an additional 606,232 shares during the last quarter. Capital Research Global Investors grew its stake in shares of McDonald's by 15.0% during the second quarter. Capital Research Global Investors now owns 12,058,661 shares of the fast-food giant’s stock valued at $1,846,905,000 after purchasing an additional 1,572,074 shares during the last quarter. Finally, Northern Trust Corp grew its stake in shares of McDonald's by 3.1% during the second quarter. Northern Trust Corp now owns 11,835,647 shares of the fast-food giant’s stock valued at $1,812,747,000 after purchasing an additional 360,212 shares during the last quarter. 67.62% of the stock is owned by institutional investors.
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McDonald's Company Profile
McDonald’s Corporation (McDonald’s) operates and franchises McDonald’s restaurants. The Company’s restaurants serve a locally relevant menu of food and drinks sold at various price points in over 100 countries. The Company’s segments include U.S., International Lead Markets, High Growth Markets, and Foundational Markets and Corporate.
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