McDonald's (MCD) closed the latest trading day at $303.58, indicating a +1.25% change from the previous session's end. The stock fell short of the S&P 500, which registered a gain of 9.52% for the day. At the same time, the Dow added 7.87%, and the tech-heavy Nasdaq gained 12.16%.
Heading into today, shares of the world's biggest hamburger chain had lost 2.26% over the past month, outpacing the Retail-Wholesale sector's loss of 13.14% and the S&P 500's loss of 13.47% in that time.
Investors will be eagerly watching for the performance of McDonald's in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on May 1, 2025. The company's upcoming EPS is projected at $2.68, signifying a 0.74% drop compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $6.13 billion, indicating a 0.58% decline compared to the corresponding quarter of the prior year.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $12.25 per share and a revenue of $26.4 billion, signifying shifts of +4.52% and +1.87%, respectively, from the last year.
Investors should also note any recent changes to analyst estimates for McDonald's. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.11% higher within the past month. As of now, McDonald's holds a Zacks Rank of #3 (Hold).
Investors should also note McDonald's's current valuation metrics, including its Forward P/E ratio of 24.47. Its industry sports an average Forward P/E of 20.7, so one might conclude that McDonald's is trading at a premium comparatively.
We can also see that MCD currently has a PEG ratio of 3.07. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As of the close of trade yesterday, the Retail - Restaurants industry held an average PEG ratio of 1.94.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 184, this industry ranks in the bottom 26% of all industries, numbering over 250.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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McDonald's Corporation (MCD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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