McDonald’s (MCD) is gearing up for a major expansion in the U.K. and Ireland. The company plans to invest £1 billion ($1.3 billion) in the region and open over 200 new restaurants over the next four years. Following this announcement, the stock gained 1.4% on Wednesday.
Don't Miss our Black Friday Offers:
- Unlock your investing potential with TipRanks Premium - Now At 40% OFF!
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
As part of the investment strategy, MCD looks to solidify its presence in high-street locations and explore new restaurant formats. Also, the company intends to upgrade its existing outlets, reflecting its commitment to improving its offerings.
Importantly, the expansion is projected to create over 24,000 new jobs, reflecting the company’s confidence in the U.K. market’s potential.
Key Reasons Behind This Investment
The U.K. takeaway market is growing as more consumers seek affordable food options due to high inflation. Furthermore, McDonald’s aims to counter the fierce competition in the U.K. market with this expansion, especially after losing its top spot for takeaway breakfast to Greggs (GB:GRG), a fast-growing bakery chain.
Moreover, this initiative is part of McDonald’s broader global growth strategy, which includes a target of opening 10,000 additional restaurants worldwide by 2027.
Is McDonald’s Stock a Buy, Sell, or Hold?
Shares of the company have gained nearly 10% over the past three months. Overall, the Street has a Moderate Buy consensus rating on the stock based on 16 Buy and seven Hold ratings. The analysts’ average price target on McDonald’s stock of $293.14 points to a 1.2% potential upside.
