McDonald’s Corporation (NYSE:MCD) Stock Has Average Target Price of $316.39

McDonald’s Corporation (NYSE:MCD) has been assigned an average recommendation of “Moderate Buy” from the twenty-nine brokerages that are presently covering the firm, Marketbeat Ratings reports. Eleven equities research analysts have rated the stock with a hold recommendation, seventeen have assigned a buy recommendation and one has issued a strong buy recommendation on the company. The average 12 month target price among brokerages that have covered the stock in the last year is $302.50.

A number of research firms have commented on MCD. BTIG Research reduced their target price on McDonald’s from $350.00 to $295.00 and set a “buy” rating on the stock in a report on Thursday. Freedom Capital upgraded McDonald’s from a “hold” rating to a “strong-buy” rating in a report on Wednesday, August 5th. Needham & Company LLC restated a “buy” rating on shares of McDonald’s in a research note on Monday. BMO Capital Markets decreased their price objective on shares of McDonald’s from $335.00 to $310.00 and set an “outperform” rating for the company in a report on Thursday. Finally, Evercore lowered their target price on shares of McDonald’s from $320.00 to $300.00 and set an “outperform” rating for the company in a research note on Thursday.

Key McDonald’s News

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

• Positive Sentiment: McDonald’s raised its quarterly dividend by nearly 4%, supporting the stock’s income appeal amid market uncertainty. The increase was included among recent dividend hikes from large companies. Dividend hikes article
• Positive Sentiment: The company’s NEXT strategy targets stronger operating margins and cash-flow conversion by 2030. Planned restaurant upgrades, AI-enabled ordering, employee training, improved chicken and protein-focused offerings, and a potential advertising business could support traffic and productivity over time. McDonald’s productivity makeover article
• Positive Sentiment: Several analysts still see upside after the selloff. Oppenheimer, JPMorgan, BTIG and RBC retained positive or constructive ratings, although each lowered its price target. A Seeking Alpha analysis also argued that the pullback improved MCD’s valuation and dividend yield. Investor day selloff analysis
• Neutral Sentiment: McDonald’s plans approximately $8.5 billion in franchisee support through 2036, including about $5 billion through 2030, to fund remodels, technology and operational improvements. The spending may strengthen the system but is expected to delay financial benefits.
• Negative Sentiment: CEO Chris Kempczinski said elevated inflation and flat restaurant traffic may persist, signaling that management does not expect a quick consumer recovery. Lower-income customers remain particularly sensitive to McDonald’s pricing. McDonald’s inflation outlook
• Negative Sentiment: Investors viewed the large franchisee-support commitment as a substantial cash burden with uncertain returns, while analysts cut targets amid concerns about weak U.S. traffic, consumer discretionary pressure and the timing of the investment. These concerns drove the recent decline and four-year-low trading levels. Reuters franchisee support plan article

McDonald’s Stock Performance

Shares of McDonald’s stock opened at $237.08 on Friday. The firm has a market cap of $167.77 billion, a PE ratio of 19.26, a price-to-earnings-growth ratio of 2.71 and a beta of 0.41. The firm’s 50-day simple moving average is $262.85 and its 200-day simple moving average is $281.07. McDonald’s has a 1 year low of $234.03 and a 1 year high of $341.75.

McDonald’s (NYSE:MCD) last posted 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 business had revenue of $7.10 billion during the quarter, compared to the consensus estimate of $7.13 billion. McDonald’s had a negative return on equity of 572.06% and a net margin of 31.72%.The company’s revenue for the quarter was up 3.7% compared to the same quarter last year. During the same period last year, the firm earned $3.19 earnings per share. On average, equities analysts predict that McDonald’s will post 12.88 earnings per share for the current year.

McDonald’s Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Tuesday, December 15th. Stockholders of record on Tuesday, December 1st will be issued a $1.93 dividend. This is a boost from McDonald’s’s previous quarterly dividend of $1.86. The ex-dividend date of this dividend is Tuesday, December 1st. This represents a $7.72 annualized dividend and a dividend yield of 3.3%. McDonald’s’s dividend payout ratio (DPR) is presently 60.44%.

Institutional Investors Weigh In On McDonald’s

Several institutional investors and hedge funds have recently bought and sold shares of MCD. Norges Bank acquired a new stake in shares of McDonald’s in the fourth quarter valued at approximately $2,890,438,000. Bank of New York Mellon Corp acquired a new position in shares of McDonald’s during the second quarter worth approximately $1,359,276,000. Diamant Asset Management Inc. boosted its position in shares of McDonald’s by 30,979.0% during the first quarter. Diamant Asset Management Inc. now owns 2,596,340 shares of the fast-food giant’s stock worth $806,917,000 after buying an additional 2,587,986 shares during the period. J. Stern & Co. LLP grew its holdings in McDonald’s by 9,867.5% in the 4th quarter. J. Stern & Co. LLP now owns 2,541,008 shares of the fast-food giant’s stock worth $776,608,000 after buying an additional 2,515,515 shares in the last quarter. Finally, Arrowstreet Capital Limited Partnership grew its holdings in McDonald’s by 49.9% in the 4th quarter. Arrowstreet Capital Limited Partnership now owns 3,104,337 shares of the fast-food giant’s stock worth $948,779,000 after buying an additional 1,033,041 shares in the last quarter. Institutional investors and hedge funds own 70.29% of the company’s stock.

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.