Robert W. Baird Has Lowered Expectations for McDonald's (NYSE:MCD) Stock Price

Key Points

• Robert W. Baird lowered McDonald’s price target from $305 to $285 while maintaining a “neutral” rating, implying roughly 6.2% upside from the prior close.
• Despite reporting adjusted earnings of $3.38 per share above estimates, McDonald’s revenue was slightly below expectations at $7.10 billion. U.S. comparable sales rose only 0.8% as value-conscious consumers reduced traffic.
• Analyst sentiment remains broadly positive, with a “Moderate Buy” consensus and average price target of $329.44, though the company faces execution challenges involving complicated promotions and slower restaurant expansion.

McDonald's (NYSE:MCD - Get Free Report) had its target price decreased by analysts at Robert W. Baird from $305.00 to $285.00 in a report issued on Wednesday. The firm presently has a "neutral" rating on the fast-food giant's stock. Robert W. Baird's price target points to a potential upside of 6.21% from the stock's previous close.

Other equities research analysts also recently issued reports about the company. Barclays dropped their target price on McDonald's from $380.00 to $350.00 and set an "overweight" rating on the stock in a report on Friday, May 8th. Evercore set a $320.00 price target on McDonald's in a report on Thursday, July 23rd. Royal Bank Of Canada lowered their price target on McDonald's from $305.00 to $295.00 and set a "sector perform" rating for the company in a research report on Wednesday. Sanford C. Bernstein reiterated a "market perform" rating on shares of McDonald's in a research note on Monday, June 22nd. Finally, Citigroup reduced their price objective on shares of McDonald's from $375.00 to $335.00 and set a "buy" rating for the company in a research note on Wednesday, July 15th. Sixteen equities research analysts have rated the stock with a Buy rating and twelve have assigned a Hold rating to the company. According to data from MarketBeat.com, McDonald's presently has a consensus rating of "Moderate Buy" and an average target price of $329.44.

McDonald's Stock Performance

Shares of NYSE MCD opened at $268.35 on Wednesday. The company has a 50 day simple moving average of $274.32 and a two-hundred day simple moving average of $297.05. McDonald's has a fifty-two week low of $260.96 and a fifty-two week high of $341.75. The company has a market capitalization of $190.66 billion, a price-to-earnings ratio of 22.12, a P/E/G ratio of 2.85 and a beta of 0.41.

McDonald's (NYSE:MCD - Get Free Report) last issued its quarterly earnings results on Tuesday, August 4th. The fast-food giant reported $3.38 EPS for the quarter, topping analysts' consensus estimates of $3.32 by $0.06. The firm had revenue of $7.10 billion for the quarter, compared to analysts' expectations of $7.13 billion. McDonald's had a negative return on equity of 442.10% and a net margin of 31.62%.The business's revenue for the quarter was up 3.7% compared to the same quarter last year. During the same period in the previous year, the firm posted $3.19 EPS. On average, analysts forecast that McDonald's will post 12.85 earnings per share for the current fiscal year.

Insider Buying and Selling at McDonald's

In other 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 transaction of $1,493,248.64. Following the transaction, the insider directly owned 7,734 shares of the company's stock, valued at $2,198,930.88. This represents a 40.44% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. Also, EVP Desiree Ralls-Morrison sold 2,763 shares of the stock in a transaction on Thursday, May 28th. The shares were 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 in the company, valued at $1,744,760.48. This trade represents a 30.59% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold 8,348 shares of company stock valued at $2,355,634 in the last 90 days. 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 the stock. Your Advocates Ltd. LLP bought a new position in McDonald's during the fourth quarter valued at approximately $27,000. IFC & Insurance Marketing Inc. bought a new stake in McDonald's in the 4th quarter worth approximately $29,000. Abound Financial LLC bought a new stake in McDonald's in the 4th quarter worth approximately $30,000. DecisionPoint Financial LLC raised its stake in McDonald's by 1,616.7% during the 4th quarter. DecisionPoint Financial LLC now owns 103 shares of the fast-food giant's stock valued at $31,000 after buying an additional 97 shares during the last quarter. Finally, Entrust Financial LLC purchased a new stake in McDonald's during the 4th quarter valued at $31,000. 70.29% of the stock is currently owned by institutional investors.

Key McDonald's News

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

• Positive Sentiment: McDonald’s reported adjusted earnings of $3.38 per share, ahead of the $3.32 analyst consensus and up from $3.19 a year earlier. Revenue rose 3.7% to $7.10 billion, while stronger franchised margins and record restaurant margins supported profits despite revenue coming in slightly below expectations. McDonald's Q2 Earnings Surpass Estimates
• Positive Sentiment: Comparable sales increased across all three operating segments, with international markets providing important support as the U.S. business slowed. Management said the company sees an opportunity to improve value, service and food quality in the domestic market. McDonald’s posts strong second quarter profit
• Neutral Sentiment: McDonald’s appointed longtime executive Skye Anderson as president of McDonald’s USA, replacing Joe Erlinger. Anderson will oversee nearly 14,000 U.S. restaurants and is tasked with restoring traffic and improving execution; the change offers a potential turnaround catalyst but also highlights the urgency of the domestic slowdown. McDonald’s names Skye Anderson as U.S. president
• Negative Sentiment: U.S. comparable sales rose only 0.8%, down from 2.5% a year earlier and below expectations. Traffic weakened as lower-income consumers remained under pressure from elevated prices and gas costs. McDonald’s US sales disappoint
• Negative Sentiment: The company acknowledged that its value strategy became overly complicated: too many simultaneous promotions and reduced digital deal activity confused customers and employees, failing to bring back enough loyal diners. McDonald’s also delayed its goal of reaching 50,000 global restaurants from 2027 to 2028, signaling a more cautious growth outlook. McDonald’s admits its value meals have become too confusing

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.

Continue following MarketBeat

Add MarketBeat as your preferred source on Google to see our latest stories in your feed.

Add As Preferred Source