Morgan Stanley analyst Brian Harbour has maintained their neutral stance on MCD stock, giving a Hold rating yesterday.
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Brian Harbour has given his Hold rating due to a combination of factors surrounding McDonald’s current strategic initiatives and market positioning. The company is reintroducing ‘Extra Value Meals’ in the U.S. market, aiming to capture more market share by offering meals at a 15% discount compared to their component costs. This move is part of McDonald’s strategy to reset its value leadership domestically, drawing lessons from international successes.
However, the financial implications of this strategy are not yet fully reflected in the company’s models, with potential initial margin pressures and a possible lag in traffic uplift. While McDonald’s plans to support this initiative with significant marketing efforts, the absence of a prior test in the U.S. market introduces uncertainty. The Hold rating reflects a cautious stance as the company navigates these changes, balancing potential risks and rewards in its bid to strengthen its competitive position.
In another report released yesterday, TD Cowen also maintained a Hold rating on the stock with a $330.00 price target.
Based on the recent corporate insider activity of 57 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of MCD in relation to earlier this year.