McDonald's (MCD) AI Stock Analysis

• Market Cap: $215.60B
• Dividend Yield: 2.28%
• Average Volume (3M): 2.95M
• Price to Earnings (P/E): 26.0
• Beta (1Y): 0.28
• Revenue Growth: 1.26%
• EPS Growth: 2.87%
• Country: US
• Employees: 150,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Restaurants
• EPS (TTM): 3.22
• Shares Outstanding: 712,154,360
• 10 Day Avg. Volume: 3,288,094
• 30 Day Avg. Volume: 2,953,374
• PEG Ratio: -16.36
• Price to Book (P/B): -54.85
• Price to Sales (P/S): 8.03
• P/FCF Ratio: 31.21
• Enterprise Value/Market Cap: 1.26
• Enterprise Value/Revenue: 10.32
• Enterprise Value/Gross Profit: 17.97
• Enterprise Value/Ebitda: 18.81
• 1Y Price Target: $324.58
• Price Target Upside: 6.71% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 23
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 65 Neutral
• Price Target: $329.00 ▲(8.17% Upside)

McDonald's overall score reflects strong financial performance and strategic growth initiatives, particularly in international markets. However, financial risks from high leverage and challenges in the U.S. market temper the score. The technical indicators suggest a neutral trend, and the valuation is moderate, contributing to a balanced outlook.

Positive Factors

Global Sales Growth

Consistent global sales growth indicates strong market presence and effective strategies, supporting long-term revenue expansion.

Menu Innovation

Successful menu innovation can drive customer engagement and increase sales, enhancing competitive advantage and market share.

International Market Strength

Strong performance in international markets reflects effective localization strategies and growth potential outside the U.S.

Negative Factors

High Debt Levels

High leverage can limit financial flexibility and increase risk, potentially impacting long-term financial health.

U.S. Market Challenges

Declining traffic among lower-income consumers suggests challenges in maintaining market share and revenue growth in the U.S.

Inflationary Pressures

Persistent inflation, especially in key inputs like beef, can pressure margins and affect profitability if not managed effectively.

McDonald's Business Overview & Revenue Model

Company Description

McDonald's Corporation (MCD) is a global fast-food restaurant chain headquartered in Chicago, Illinois. It operates in the quick-service restaurant sector, primarily serving hamburgers, fries, chicken, salads, breakfast items, and beverages. As one of the largest and most recognizable brands in the world, McDonald's operates thousands of locations worldwide, offering both dine-in and drive-thru services. The company has also expanded its menu to include healthier options and is continually adapting to changing consumer preferences.

How the Company Makes Money

McDonald's generates revenue through a combination of company-operated restaurants and franchising fees. The primary revenue streams include sales from its own restaurants and rental income and royalties from franchisees. Franchisees pay an initial franchise fee and ongoing royalties based on a percentage of their sales. Additionally, McDonald's earns revenue from the sale of food and beverages, as well as through strategic partnerships, including collaborations with delivery services like Uber Eats and partnerships for promotional items. The company also benefits from economies of scale, allowing it to negotiate favorable terms with suppliers, ultimately contributing to its profitability.

McDonald's Financial Statement Overview

Summary

McDonald's shows strong profitability and cash generation with impressive revenue growth. However, the high debt-to-equity ratio and negative equity pose financial risks, impacting overall stability.

Income Statement

McDonald's demonstrates strong profitability with a consistent gross profit margin around 57% and a net profit margin exceeding 32% in TTM. The company shows impressive revenue growth of 78.3% in TTM, indicating robust expansion. EBIT and EBITDA margins are also healthy, reflecting efficient operations.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio due to negative equity, which poses a financial risk. Despite this, McDonald's maintains a substantial asset base. The negative return on equity reflects the challenges of negative equity, impacting overall financial stability.

Cash Flow

McDonald's cash flow is strong, with a positive free cash flow growth rate of 6.9% in TTM. The operating cash flow to net income ratio is favorable, indicating efficient cash generation relative to earnings. However, the free cash flow to net income ratio suggests room for improvement in cash utilization.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	26.26B	25.92B	25.50B	23.18B	23.22B	19.21B
Gross Profit	15.08B	14.71B	14.56B	13.21B	12.58B	9.75B
EBITDA	14.41B	13.95B	13.86B	10.90B	12.18B	9.11B
Net Income	8.41B	8.22B	8.47B	6.18B	7.55B	4.73B
Balance Sheet
Total Assets	60.61B	55.18B	56.15B	50.44B	53.85B	52.63B
Cash, Cash Equivalents and Short-Term Investments	2.41B	1.08B	4.58B	2.58B	4.71B	3.45B
Total Debt	55.82B	51.95B	53.09B	48.70B	49.35B	51.46B
Total Liabilities	62.77B	58.98B	60.85B	56.44B	58.46B	60.45B
Stockholders Equity	-2.16B	-3.80B	-4.71B	-6.00B	-4.60B	-7.82B
Cash Flow
Free Cash Flow	7.37B	6.67B	7.25B	5.49B	7.10B	4.62B
Operating Cash Flow	10.48B	9.45B	9.61B	7.39B	9.14B	6.27B
Investing Cash Flow	-3.49B	-5.35B	-3.18B	-2.68B	-2.17B	-1.55B
Financing Cash Flow	-5.76B	-7.50B	-4.37B	-6.58B	-5.60B	-2.25B

McDonald's Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 304.16
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MCD, the sentiment is Positive. The current price of 304.16 is above the 20-day moving average (MA) of 303.43, above the 50-day MA of 302.95, and above the 200-day MA of 303.65, indicating a bullish trend. The MACD of 0.31 indicates Negative momentum. The RSI at 50.68 is Neutral, neither overbought nor oversold. The STOCH value of 52.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MCD.

McDonald's Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MCD	65 Neutral	$215.60B	25.98	―	2.28%	1.26%	2.87%
CMG	64 Neutral	$40.99B	26.75	44.96%	―	7.31%	5.26%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
WEN	60 Neutral	$1.55B	8.61	100.85%	8.70%	-0.21%	0.16%
YUM	60 Neutral	$41.18B	28.98	―	1.88%	11.60%	-4.33%
DPZ	58 Neutral	$13.50B	23.57	―	1.68%	3.92%	4.98%
SBUX	54 Neutral	$95.15B	51.16	―	2.97%	2.80%	-50.71%

McDonald's Corporate Events

McDonald’s Reports Strong Q3 2025 Sales Growth

McDonald’s Corporation is the world’s leading global foodservice retailer, operating over 44,000 locations in more than 100 countries, with a significant portion of its restaurants owned and operated by independent local business owners.

McDonald’s Earnings Call: Growth Amid Challenges

McDonald’s Corporation’s recent earnings call revealed a balanced sentiment, highlighting both positive achievements and ongoing challenges. The company showcased strong global sales growth and success with new innovations, such as a promising beverage test. However, it also acknowledged continued challenges with inflation and bifurcated consumer trends in the U.S. Despite these pressures, McDonald’s is effectively navigating the environment with strategic value offerings and maintaining strong performance in international markets.

McDonald’s Issues $1.3 Billion in Medium-Term Notes

On August 27, 2025, McDonald’s Corporation issued $550 million of 4.400% Medium-Term Notes due 2031 and $750 million of 5.000% Medium-Term Notes due 2036. This issuance is part of the company’s medium-term notes program, aiming to strengthen its financial position and support its strategic initiatives.

The most recent analyst rating on (MCD) stock is a Buy with a $360.00 price target. To see the full list of analyst forecasts on McDonald’s stock, see the MCD Stock Forecast page.

McDonald’s Reports Strong Q2 2025 Financial Results

McDonald’s Corporation is the world’s leading global foodservice retailer, operating over 44,000 locations in more than 100 countries, with the majority of its restaurants owned and operated by independent local business owners.

McDonald’s Earnings Call: Growth Amid U.S. Challenges

McDonald’s Corporation’s recent earnings call painted a picture of moderate growth and technological advancements, particularly in international markets. However, this optimism was tempered by challenges in the U.S. market, where inflation and decreased consumer visits have posed significant hurdles. While there are positive strides in loyalty programs and technology, the challenges in the U.S. market create a balanced sentiment overall.