NYSE:MCD

Stock Analysis Report

Executive Summary

McDonald's Corporation operates and franchises McDonald's restaurants in the United States and internationally.

Snowflake

Fundamentals

Established dividend payer with proven track record.


Similar Companies

Share Price & News

How has McDonald's's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-1.7%

NYSE:MCD

-0.7%

US Hospitality

-1.6%

US Market


1 Year Return

34.7%

NYSE:MCD

-7.0%

US Hospitality

-3.0%

US Market

MCD outperformed the Hospitality industry which returned -7% over the past year.

MCD outperformed the Market in United States of America which returned -3% over the past year.


Share holder returns

MCDIndustryMarket
7 Day-1.7%-0.7%-1.6%
30 Day0.1%-7.6%-5.7%
90 Day8.5%-0.7%0.2%
1 Year38.0%34.7%-4.8%-7.0%-0.8%-3.0%
3 Year102.8%87.6%42.8%33.8%38.1%29.1%
5 Year162.3%129.0%31.5%17.1%50.8%34.1%

Price Volatility Vs. Market

How volatile is McDonald's's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is McDonald's undervalued based on future cash flows and its price relative to the stock market?

27.92x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

McDonald's's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).

McDonald's's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).


Price Based on Earnings

McDonald's is overvalued based on earnings compared to the US Hospitality industry average.

McDonald's is overvalued based on earnings compared to the United States of America market.


Price Based on Expected Growth

McDonald's is poor value based on expected growth next year.


Price Based on Value of Assets

McDonald's has negative assets, we can't compare the value of its assets to the US Hospitality industry average.


Next Steps

Future Growth

How is McDonald's expected to perform in the next 1 to 3 years based on estimates from 28 analysts?

5.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

McDonald's's revenue is expected to grow by 3.1% yearly, however this is not considered high growth (20% yearly).

McDonald's's earnings are expected to grow by 5.9% yearly, however this is not considered high growth (20% yearly).

McDonald's's revenue growth is positive but not above the United States of America market average.

McDonald's's earnings growth is positive but not above the United States of America market average.

McDonald's's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if McDonald's will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has McDonald's performed over the past 5 years?

4.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

McDonald's's year on year earnings growth rate has been positive over the past 5 years.

McDonald's's 1-year earnings growth exceeds its 5-year average (8.1% vs 4.6%)

McDonald's's earnings growth has exceeded the US Hospitality industry average in the past year (8.1% vs -8.7%).


Return on Equity

It is difficult to establish if McDonald's has efficiently used shareholders’ funds last year (Return on Equity greater than 20%) due to its liabilities exceeding its assets.


Return on Assets

McDonald's used its assets more efficiently than the US Hospitality industry average last year based on Return on Assets.


Return on Capital Employed

McDonald's's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is McDonald's's financial position?


Financial Position Analysis

McDonald's is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

McDonald's's long term commitments exceed its cash and other short term assets.


Debt to Equity History and Analysis

McDonald's has negative shareholder equity (liabilities exceed assets), this is a more serious situation compared with a high debt level.

Irrelevant to check if McDonald's's debt level has increased considering it has negative shareholder equity.

Debt is well covered by operating cash flow (24.3%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 8.4x coverage).


Balance Sheet

High level of physical assets or inventory.

McDonald's has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Next Steps

Dividend

What is McDonald's's current dividend yield, its reliability and sustainability?

2.30%

Expected Dividend Yield


Upcoming Dividend Payment

Purchase McDonald's before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield and Payments Analysis

McDonald's's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.52%).

McDonald's's dividend is below the markets top 25% of dividend payers in United States of America (3.93%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are covered by earnings (1.7x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be covered by earnings (1.8x coverage).


Next Steps

Management

What is the CEO of McDonald's's salary, the management and board of directors tenure and is there insider trading?

4.0yrs

Average management tenure


CEO

Steve Easterbrook (52yo)

4.4yrs

Tenure

US$15,876,116

Compensation

Mr. Stephen J. Easterbrook, also known as Steve, has been the Chief Executive Officer and President of McDonald's Corporation since March 1, 2015. Mr. Easterbrook served as the Chief Brand Officer and Seni ...


CEO Compensation Analysis

Steve's remuneration is higher than average for companies of similar size in United States of America.

Steve's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

4.0yrs

Average Tenure

50yo

Average Age

The tenure for the McDonald's management team is about average.


Board Age and Tenure

7.5yrs

Average Tenure

63.5yo

Average Age

The tenure for the McDonald's board of directors is about average.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

SellUS$2,118,80903 May 19
Christopher Kempczinski
EntityIndividual
Role
Senior Key Executive
President of USA
Shares10,854
Max PriceUS$195.21
SellUS$441,33403 May 19
Jerome Krulewitch
EntityIndividual
Role
Chief Legal Officer
Corporate Executive VP
Shares2,257
Max PriceUS$195.54
SellUS$1,959,20003 May 19
Kevin Ozan
EntityIndividual
Role
Chief Financial Officer
Corporate Executive VP & CFO
Shares10,000
Max PriceUS$195.92
SellUS$50,00825 Feb 19
Catherine Hoovel
EntityIndividual
Role
Chief Accounting Officer
Corporate VP & Chief Accounting Officer
Shares280
Max PriceUS$178.60
SellUS$537,76707 Feb 19
Daniel Henry
EntityIndividual
Role
Chief Information Officer
Corporate Executive VP & Chief Information Officer
Shares3,036
Max PriceUS$177.13
SellUS$5,408,10004 Feb 19
Andrew McKenna
EntityIndividual
Role
Chairman Emeritus
Chairman Emeritus
Shares30,000
Max PriceUS$180.27
SellUS$562,33526 Oct 18
Jerome Krulewitch
EntityIndividual
Role
Chief Legal Officer
Corporate Executive VP
Shares3,192
Max PriceUS$176.17

Ownership Breakdown


Management Team

  • Steve Easterbrook (52yo)

    President

    • Tenure: 4.4yrs
    • Compensation: US$15.88m
  • Kevin Ozan (56yo)

    Corporate Executive VP & CFO

    • Tenure: 4.4yrs
    • Compensation: US$4.65m
  • Silvia Lagnado (55yo)

    Corporate Executive VP & Global Chief Marketing Officer

    • Tenure: 4.0yrs
    • Compensation: US$3.97m
  • Robert Gibbs (48yo)

    Corporate Executive VP & Global Chief Communications Officer

    • Tenure: 4.2yrs
  • Chris Kempczinski (50yo)

    President of USA

    • Tenure: 2.6yrs
    • Compensation: US$4.68m
  • Mike Flores

    Senior VP & Investor Relations Officer

    • Tenure: 0.0yrs
  • Joe Erlinger (45yo)

    President of International Operated Markets

    • Tenure: 4.4yrs
    • Compensation: US$3.96m
  • Catherine Hoovel (48yo)

    Corporate VP & Chief Accounting Officer

    • Tenure: 2.8yrs
  • Jerome Krulewitch (54yo)

    Corporate Executive VP

    • Tenure: 2.4yrs
  • Daniel Henry (48yo)

    Corporate Executive VP & Chief Information Officer

    • Tenure: 1.8yrs

Board Members

  • Rick Lenny (67yo)

    Independent Director

    • Tenure: 13.9yrs
    • Compensation: US$296.05k
  • Miles White (64yo)

    Independent Director

    • Tenure: 10.3yrs
    • Compensation: US$311.05k
  • Sheila Penrose (73yo)

    Independent Director

    • Tenure: 13.3yrs
    • Compensation: US$321.05k
  • Robert Eckert (65yo)

    Independent Director

    • Tenure: 16.6yrs
    • Compensation: US$321.05k
  • Andrew McKenna (90yo)

    Chairman Emeritus

    • Tenure: 3.3yrs
    • Compensation: US$156.45k
  • John Rogers (60yo)

    Independent Director

    • Tenure: 16.6yrs
    • Compensation: US$286.05k
  • Rick Hernandez (63yo)

    Non-Executive Chairman of the Board

    • Tenure: 3.3yrs
    • Compensation: US$777.28k
  • Steve Easterbrook (52yo)

    President

    • Tenure: 4.4yrs
    • Compensation: US$15.88m
  • Margo Georgiadis (55yo)

    Independent Director

    • Tenure: 4.6yrs
    • Compensation: US$286.05k
  • John Mulligan (53yo)

    Independent Director

    • Tenure: 4.0yrs
    • Compensation: US$326.05k

Company Information

McDonald's Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: McDonald's Corporation
  • Ticker: MCD
  • Exchange: NYSE
  • Founded: 1940
  • Industry: Restaurants
  • Sector: Consumer Services
  • Market Cap: US$163.022b
  • Shares outstanding: 759.44m
  • Website: https://corporate.mcdonalds.com

Number of Employees


Location

  • McDonald's Corporation
  • 110 North Carpenter Street
  • Chicago
  • Illinois
  • 60607
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MCDNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
MCDSWX (SIX Swiss Exchange)YesCommon StockCHCHFJan 1968
MCD *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJan 1968
MDODB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
MDOXTRA (XETRA Trading Platform)YesCommon StockDEEURJan 1968
MCDBVC (Bolsa de Valores de Colombia)YesCommon StockCOCOPJan 1968
MCDSNSE (Santiago Stock Exchange)YesCommon StockCLUSDJan 1968
MCDWBAG (Wiener Boerse AG)YesCommon StockATEURJan 1968
MCDBASE (Buenos Aires Stock Exchange)CEDEAR (4 REP 1 USD0.01)ARARSJan 2000
MCDC34BOVESPA (Bolsa de Valores de Sao Paulo)BDR REPR 1/4 COM USD0.01BRBRLDec 2011

Biography

McDonald's Corporation operates and franchises McDonald's restaurants in the United States and internationally. Its restaurants offer various food products, soft drinks, coffee, and other beverages, as wel ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/24 23:47
End of Day Share Price2019/08/23 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.