Tandem Investment Advisors Inc. Acquires New Holdings in McDonald's Corporation $MCD

Key Points

• Tandem Investment Advisors opened a new position in McDonald's during the first quarter, buying 86,791 shares worth about $27.0 million.
• McDonald's stock was down 2.1% to $267.74, near its 52-week low, as investors weighed recent weakness against the company's large market cap and defensive profile.
• The company recently beat quarterly earnings estimates with $2.83 EPS and $6.52 billion in revenue, while also paying a $1.86 quarterly dividend that implies a 2.8% yield.

Tandem Investment Advisors Inc. bought a new position in shares of McDonald's Corporation (NYSE:MCD - Free Report) in the first quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission (SEC). The institutional investor bought 86,791 shares of the fast-food giant's stock, valued at approximately $26,974,000.

Other large investors have also recently made changes to their positions in the company. Your Advocates Ltd. LLP purchased a new position in McDonald's in the fourth quarter valued at about $27,000. Park Place Capital Corp grew its position in shares of McDonald's by 95.7% in the 4th quarter. Park Place Capital Corp now owns 92 shares of the fast-food giant's stock worth $28,000 after buying an additional 45 shares during the last quarter. IFC & Insurance Marketing Inc. bought a new position in shares of McDonald's during the 4th quarter worth approximately $29,000. Abound Financial LLC bought a new position in shares of McDonald's during the 4th quarter worth approximately $30,000. Finally, DecisionPoint Financial LLC lifted its position in McDonald's by 1,616.7% during the fourth quarter. DecisionPoint Financial LLC now owns 103 shares of the fast-food giant's stock valued at $31,000 after acquiring an additional 97 shares during the last quarter. 70.29% of the stock is owned by institutional investors.

McDonald's Stock Down 2.1%

MCD stock opened at $267.74 on Friday. The firm has a 50 day moving average of $277.07 and a 200 day moving average of $300.33. The stock has a market capitalization of $190.23 billion, a PE ratio of 22.07, a price-to-earnings-growth ratio of 2.78 and a beta of 0.41. McDonald's Corporation has a 52 week low of $264.09 and a 52 week high of $341.75.

McDonald's (NYSE:MCD - Get Free Report) last released its earnings results on Thursday, May 7th. The fast-food giant reported $2.83 earnings per share for the quarter, topping the consensus estimate of $2.74 by $0.09. McDonald's had a net margin of 31.62% and a negative return on equity of 442.10%. The company had revenue of $6.52 billion for the quarter, compared to the consensus estimate of $6.47 billion. During the same quarter in the previous year, the firm earned $2.67 EPS. McDonald's's revenue was up 9.4% compared to the same quarter last year. On average, equities research analysts expect that McDonald's Corporation will post 12.86 earnings per share for the current year.

McDonald's Announces Dividend

The business also recently disclosed a quarterly dividend, which was paid on Tuesday, June 16th. Stockholders of record on Tuesday, June 2nd were paid a dividend of $1.86 per share. This represents a $7.44 annualized dividend and a dividend yield of 2.8%. The ex-dividend date was Tuesday, June 2nd. McDonald's's payout ratio is presently 61.34%.

Insiders Place Their Bets

In related news, insider Joseph M. Erlinger sold 5,252 shares of the firm's stock in a transaction on Wednesday, June 10th. The stock was sold at an average price of $284.32, for a total value of $1,493,248.64. Following the completion of the transaction, the insider owned 7,734 shares in the company, valued at $2,198,930.88. This trade represents a 40.44% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available at this link. Also, EVP Desiree Ralls-Morrison sold 2,763 shares of McDonald's stock in a transaction dated Thursday, May 28th. The stock was sold at an average price of $278.36, for a total value of $769,108.68. Following the sale, the executive vice president directly owned 6,268 shares of the company's stock, valued at approximately $1,744,760.48. This represents a 30.59% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 8,681 shares of company stock worth $2,456,440 over the last three months. Corporate insiders own 0.26% of the company's stock.

Analysts Set New Price Targets

Several brokerages have weighed in on MCD. Erste Group Bank downgraded shares of McDonald's from a "buy" rating to a "hold" rating in a research note on Monday, April 27th. Citigroup reduced their price target on McDonald's from $375.00 to $335.00 and set a "buy" rating on the stock in a research report on Wednesday. Wells Fargo & Company decreased their price objective on McDonald's from $320.00 to $300.00 and set an "overweight" rating for the company in a report on Thursday. BTIG Research reissued a "buy" rating and issued a $370.00 price objective on shares of McDonald's in a research report on Thursday, May 7th. Finally, Evercore set a $350.00 target price on McDonald's in a research note on Friday, May 8th. Fifteen research analysts have rated the stock with a Buy rating and twelve have issued a Hold rating to the stock. According to MarketBeat.com, McDonald's currently has a consensus rating of "Moderate Buy" and a consensus target price of $336.32.

McDonald's News Roundup

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

• Positive Sentiment: Tigress Financial raised its price target on McDonald’s to $390 from $385 and reiterated a buy rating, signaling confidence that the stock has meaningful upside from current levels.
• Positive Sentiment: Analyst coverage and commentary continue to highlight McDonald’s value offerings, loyalty efforts, localized marketing, and menu innovation as ways the company can support customer traffic and defend sales trends.
• Neutral Sentiment: McDonald’s is expected to report second-quarter earnings next month, with consensus calling for modest single-digit profit growth, keeping investor focus on whether traffic and margins improve.
• Neutral Sentiment: Recent product news, including the new Caesar sauce and other menu rollouts, is generating consumer interest, but the items appear more promotional than clearly material to near-term earnings.
• Negative Sentiment: Articles questioning why McDonald’s stock is at nearly two-year lows and noting a 10.1% decline over the past six months versus a rising S&P 500 suggest investors are worried about relative underperformance and slowing momentum.
• Negative Sentiment: Commentary describing a “McProblem” that is not getting better points to continuing concerns about business execution, customer traffic, or overall sentiment toward the stock.
• Negative Sentiment: One recent piece also urged investors to stay skeptical, indicating that while the stock may look attractive to some value investors, there are still fundamental questions weighing on shares.

About McDonald's

McDonald's Corporation NYSE: MCD is a global quick-service restaurant company best known for its hamburgers, French fries and breakfast offerings. The company develops, operates and franchises a system of restaurants that sell a range of food and beverage items, including signature products such as the Big Mac, Quarter Pounder, Chicken McNuggets, McCafé coffee beverages and a variety of salads, desserts and seasonal menu items. McDonald's serves customers through company-operated restaurants and franchised locations, and it supports sales via dine-in, drive-thru, digital ordering platforms and third-party delivery partnerships.

Founded in 1940 by brothers Richard and Maurice McDonald as a single San Bernardino, California restaurant, the business was transformed into a franchising model after Ray Kroc joined in the mid-1950s and led the brand's national and international expansion.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.