DBS analyst Alison Fok reiterated a Buy rating on McDonald’s (MCD – Research Report) yesterday and set a price target of $339.00.
Alison Fok has given his Buy rating due to a combination of factors illustrating McDonald’s Corporation’s robust performance and strategic growth initiatives. The company’s second quarter results exceeded expectations with strong growth in comparable sales and guest counts globally. The impressive double-digit comparable sales growth was consistent across all segments, signifying a broad base of success. Furthermore, McDonald’s has made significant strides in digital system sales in its top markets, contributing to nearly 40% of sales, showcasing the effectiveness of its digital transformation efforts.
Additionally, Fok underscores McDonald’s commitment to technological and product innovation as pivotal for its long-term growth. With a majority of restaurants offering Drive-Thru capabilities and a focus on enhancing digital and delivery services, McDonald’s aims to provide a more streamlined customer experience. The planned opening of about 1,900 new restaurants in the fiscal year 2023 is set to further drive system sales growth. Steady EBITDA growth and margin expansion, coupled with strategic cost management to mitigate inflationary pressures, further justify the optimistic outlook. Fok’s target price of $339 per share reflects confidence in McDonald’s resilience and growth trajectory, cementing the Buy rating despite potential macroeconomic challenges.
In another report released yesterday, BMO Capital also maintained a Buy rating on the stock with a $330.00 price target.
MCD’s price has also changed slightly for the past six months – from $261.970 to $274.430, which is a 4.76% increase.
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McDonald’s (MCD) Company Description:
Founded in 1955, McDonald’s Corp. is world’s leading fast food chain that operates and franchises over 30,000 restaurants in more than 100 countries. More than 90% of McDonald’s restaurants are owned and operated by independent local business owners. Its popular products include Big Mac, Quarter Pounder with Cheese, Filet-O-Fish, Chicken McNuggets, McDonald’s Fries, McFlurry desserts, and McCafé beverages, among others. The company is headquartered in Oak Brook, Illinois.
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