McDonald's Corporation (NYSE:MCD) Given Consensus Rating of "Moderate Buy" by Analysts

Key Points

• McDonald's has a “Moderate Buy” consensus rating from 30 analysts, with 16 buy ratings, 13 hold ratings, and 1 sell rating. The average 1-year price target is about $335.70, above the stock’s recent trading level.
• The company’s latest quarterly results topped expectations, reporting $2.83 EPS versus the $2.74 estimate and $6.52 billion in revenue, up 9.4% year over year. Analysts now expect McDonald's to earn $12.93 per share for the full fiscal year.
• McDonald's continues to appeal to income investors, recently paying a $1.86 quarterly dividend that annualizes to $7.44 per share and yields roughly 2.7%. However, recent commentary also points to margin pressure and softer traffic, which could weigh on sentiment.

McDonald's Corporation (NYSE:MCD - Get Free Report) has earned an average rating of "Moderate Buy" from the thirty analysts that are presently covering the company, MarketBeat Ratings reports. One equities research analyst has rated the stock with a sell rating, thirteen have given a hold rating and sixteen have issued a buy rating on the company. The average 1-year price objective among brokers that have issued ratings on the stock in the last year is $335.7037.

Several research analysts have commented on the stock. Erste Group Bank lowered shares of McDonald's from a "buy" rating to a "hold" rating in a research note on Monday, April 27th. Robert W. Baird set a $305.00 target price on shares of McDonald's in a report on Thursday, May 7th. KeyCorp dropped their price target on shares of McDonald's from $330.00 to $315.00 and set an "overweight" rating for the company in a research note on Monday, June 29th. JPMorgan Chase & Co. cut their price target on shares of McDonald's from $325.00 to $305.00 and set an "overweight" rating on the stock in a report on Monday, May 11th. Finally, 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.

McDonald's Price Performance

NYSE:MCD opened at $280.48 on Friday. The firm has a market capitalization of $199.29 billion, a price-to-earnings ratio of 23.12, a PEG ratio of 2.80 and a beta of 0.41. McDonald's has a 1 year low of $264.53 and a 1 year high of $341.75. The business has a 50 day simple moving average of $280.25 and a 200-day simple moving average of $303.22.

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, beating the consensus estimate of $2.74 by $0.09. McDonald's had a negative return on equity of 442.10% and a net margin of 31.62%.The firm 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 company posted $2.67 EPS. The company's revenue for the quarter was up 9.4% compared to the same quarter last year. As a group, analysts expect that McDonald's will post 12.93 earnings per share for the current fiscal year.

McDonald's Announces Dividend

The firm also recently announced 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. The ex-dividend date of this dividend was Tuesday, June 2nd. This represents a $7.44 dividend on an annualized basis and a dividend yield of 2.7%. McDonald's's dividend payout ratio is currently 61.34%.

Insider Activity at McDonald's

In other McDonald's news, insider Joseph M. Erlinger sold 5,252 shares of the company'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 transaction, the insider owned 7,734 shares of the company's stock, valued at $2,198,930.88. This represents a 40.44% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, EVP Desiree Ralls-Morrison sold 2,763 shares of the stock in a transaction on Thursday, May 28th. The stock was sold at an average price of $278.36, for a total value of $769,108.68. Following the completion of the sale, the executive vice president owned 6,268 shares in the company, valued at approximately $1,744,760.48. The trade was a 30.59% decrease in their position. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders sold 11,307 shares of company stock worth $3,262,622. Company insiders own 0.26% of the company's stock.

Institutional Trading of McDonald's

A number of large investors have recently made changes to their positions in MCD. MassMutual Private Wealth & Trust FSB boosted its position in McDonald's by 0.7% in the 2nd quarter. MassMutual Private Wealth & Trust FSB now owns 126,293 shares of the fast-food giant's stock valued at $34,138,000 after buying an additional 874 shares during the period. CX Institutional increased its position in shares of McDonald's by 3.5% during the second quarter. CX Institutional now owns 39,602 shares of the fast-food giant's stock worth $10,705,000 after acquiring an additional 1,334 shares during the period. First County Bank CT raised its stake in shares of McDonald's by 1.2% during the second quarter. First County Bank CT now owns 5,067 shares of the fast-food giant's stock valued at $1,370,000 after acquiring an additional 59 shares in the last quarter. Miller Global Investments LLC raised its stake in shares of McDonald's by 127.5% during the second quarter. Miller Global Investments LLC now owns 273 shares of the fast-food giant's stock valued at $74,000 after acquiring an additional 153 shares in the last quarter. Finally, Adelphi Trust Co boosted its holdings in shares of McDonald's by 17.8% in the second quarter. Adelphi Trust Co now owns 3,880 shares of the fast-food giant's stock valued at $1,049,000 after purchasing an additional 585 shares during the period. 70.29% of the stock is owned by hedge funds and other institutional investors.

McDonald's News Summary

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

• Positive Sentiment: McDonald's stock was lifted by a UBS note highlighting it as an attractive defensive dividend name, helping support the shares as investors rotate toward stable cash-generating companies. Why McDonald's (MCD) Stock Is Up Today
• Positive Sentiment: McDonald's continues to appeal to income investors after its latest quarterly dividend, reinforcing its reputation as one of the most reliable dividend payers in the Dow. Despite Franchisees Struggling, McDonald's Dividend Keeps Rising
• Positive Sentiment: New menu and promotional chatter, including Happy Meal tie-ins, free fries offers, and added chicken items, could help drive customer engagement and traffic. BT21 Toys Teases Coming To McDonald's Happy Meals On July 14
• Neutral Sentiment: McDonald's is also getting broader media attention around its brand history and restaurant expansion plans, but these items are not likely to move the stock much on their own. The McDonald's Big Mac jingle from the mid '70s that still lives in our heads
• Neutral Sentiment: McDonald's hired a new development executive to support its NEXT strategy, which signals execution progress but is still more of a long-term operating update than an immediate stock catalyst. McDonald’s taps Raising Cane’s vet to lead development
• Negative Sentiment: A Trefis report said McDonald's is facing a real risk from trying to win over budget-conscious customers, with franchisee strain from inflation and weak consumer sentiment weighing on the system. The Real Risk Squeezing McDonald's Stock
• Negative Sentiment: Another recent analysis said MCD is near 52-week lows because of margin pressure at franchisees and softer foot traffic, which continues to limit enthusiasm despite the dividend appeal. Should You Buy McDonald’s (MCD) At 52-Week Lows

McDonald's Company Profile

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.

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