McDonald's (NYSE:MCD) Cut to "Hold" at Freedom Broker

Key Points

• Freedom Broker downgraded McDonald’s from “buy” to “hold” and cut its price target from $305 to $298, implying about 7.2% upside from the prior close.
• Analyst views remain broadly positive: MarketBeat reports a “Moderate Buy” consensus and an average price target of $297.53, though recent ratings range from buy to sell.
• McDonald’s beat quarterly EPS estimates ($3.57 versus $3.38), but revenue came in below expectations at $7.16 billion versus $7.28 billion; weaker U.S. sales and traffic remain concerns.

McDonald's (NYSE:MCD - Get Free Report) was downgraded by Freedom Broker from a "buy" rating to a "hold" rating in a research report issued on Thursday, Benzinga reports. They currently have a $298.00 price objective on the fast-food giant's stock, down from their previous price objective of $305.00. Freedom Broker's price objective suggests a potential upside of 7.17% from the company's previous close.

MCD has been the subject of several other reports. Citigroup raised their target price on McDonald's from $295.00 to $315.00 and gave the company a "buy" rating in a research note on Thursday. Seaport Research Partners assumed coverage on McDonald's in a research note on Wednesday, September 16th. They issued a "neutral" rating on the stock. Jefferies Financial Group reduced their price target on McDonald's from $260.00 to $250.00 and set an "overweight" rating for the company in a report on Tuesday, September 29th. Mizuho lowered their price objective on McDonald's from $290.00 to $260.00 and set a "neutral" rating for the company in a research note on Friday, October 30th. Finally, Melius Research dropped their price objective on McDonald's from $250.00 to $230.00 and set a "sell" rating on the stock in a report on Monday, September 28th. One equities research analyst has rated the stock with a Strong Buy rating, twenty-two have issued a Buy rating, fourteen have given a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and a consensus target price of $297.53.

McDonald's Trading Down 0.8%

MCD opened at $278.06 on Thursday. McDonald's has a twelve month low of $229.20 and a twelve month high of $341.75. The firm has a market cap of $196.77 billion, a price-to-earnings ratio of 22.00, a PEG ratio of 3.20 and a beta of 0.42. The company has a fifty day simple moving average of $248.43 and a 200 day simple moving average of $282.70.

McDonald's (NYSE:MCD - Get Free Report) last issued its quarterly earnings data on Wednesday, November 4th. The fast-food giant reported $3.57 EPS for the quarter, topping analysts' consensus estimates of $3.38 by $0.19. The firm had revenue of $7.16 billion for the quarter, compared to analyst estimates of $7.28 billion. McDonald's had a net margin of 32.38% and a negative return on equity of 671.56%. The firm's revenue was up 1.1% compared to the same quarter last year. During the same quarter in the previous year, the business posted $3.22 EPS. On average, analysts forecast that McDonald's will post 12.83 earnings per share for the current fiscal year.

Institutional Investors Weigh In On McDonald's

A number of institutional investors have recently modified their holdings of the stock. Bank of New York Mellon Corp bought a new position in McDonald's during the 2nd quarter worth approximately $1,359,276,000. Bessemer Group Inc. grew its holdings in McDonald's by 132.1% during the first quarter. Bessemer Group Inc. now owns 1,325,880 shares of the fast-food giant's stock valued at $412,071,000 after purchasing an additional 754,596 shares during the period. State Street Corp increased its stake in McDonald's by 1.8% in the second quarter. State Street Corp now owns 36,080,505 shares of the fast-food giant's stock valued at $9,752,921,000 after purchasing an additional 646,675 shares in the last quarter. Arrowstreet Capital Limited Partnership increased its stake in McDonald's by 17.2% in the first quarter. Arrowstreet Capital Limited Partnership now owns 3,637,785 shares of the fast-food giant's stock valued at $1,130,587,000 after purchasing an additional 533,448 shares in the last quarter. Finally, Ascentis Wealth Management LLC increased its stake in McDonald's by 23,222.1% in the second quarter. Ascentis Wealth Management LLC now owns 478,103 shares of the fast-food giant's stock valued at $129,236,000 after purchasing an additional 476,053 shares in the last quarter. Institutional investors and hedge funds own 70.29% of the company's stock.

Key Headlines Impacting McDonald's

Here are the key news stories impacting McDonald's this week:

• Positive Sentiment: Third-quarter adjusted EPS of $3.57 topped estimates of $3.38, with international growth and stronger franchised margins helping offset softer U.S. results. Article: McDonald's Q3 Earnings Beat, but U.S. Traffic Still Pressures Growth
• Positive Sentiment: Management is testing value bundles at nearly 1,900 U.S. restaurants ahead of a planned national platform in early 2027, aiming to attract cost-conscious customers. The initiative could help revive traffic if the pilot succeeds. Article: McDonald’s plans new value bundles next year after US traffic falls in third quarter
• Neutral Sentiment: Several firms raised price targets, including Wells Fargo to $300 and Citigroup to $315, while JPMorgan’s new $270 target is below the referenced $278.06 share price. Oppenheimer also cautioned that technical indicators look stretched after a strong recent rally. Article: Wells Fargo & Company Issues Positive Forecast for McDonald's Stock Price
• Negative Sentiment: Revenue of $7.16 billion missed expectations of about $7.28 billion, and U.S. comparable sales declined 0.2% as customers remained under pressure from the cost of living. U.S. traffic weakness is the main risk to sustaining growth. Article: McDonald's Beats Earnings, but US Sales Tell Another Story
• Negative Sentiment: McDonald’s U.S. marketing chief is stepping down amid declining sales, adding a leadership transition as the company works to improve domestic performance. Article: McDonald’s US CMO steps down as sales decline

About McDonald's

McDonald’s Corporation is a global quick-service restaurant company that operates and franchises restaurants under the McDonald’s brand. Its restaurants serve a menu that includes hamburgers, cheeseburgers, chicken sandwiches, French fries, breakfast items, desserts, salads, beverages and coffee. Offerings vary by market, and many locations provide drive-thru service, delivery and digital ordering through the McDonald’s mobile app.

The company operates through a heavily franchised business model, with restaurants owned and operated by independent franchisees, affiliates and the company itself.

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