McDonald’s Earnings: Third Straight Quarter of Rising Profit

Wall St. Cheat Sheet

S&P 500 component McDonald’s Corporation reported its results for the fourth quarter. McDonald’s franchises and operates fast food restaurants worldwide.

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McDonald’s Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for McDonald’s Corporation rose to $1.38 billion ($1.33 per share) vs. $1.24 billion ($1.16 per share) in the same quarter a year earlier. This marks a rise of 10.8% from the year earlier quarter.

Revenue: Rose 9.8% to $6.82 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: MCD beat the mean analyst estimate of $1.29 per share. Analysts were expecting revenue of $6.8 billion.

Quoting Management: “During 2011, McDonald’s continued momentum drove higher profitability and market share gains as we fortified our leadership position around the world,” said McDonald’s Chief Executive Officer Jim Skinner. “The ongoing strength of McDonald’s results is rooted in our Plan to Win with a relentless focus on what matters most to our customers. We are enhancing the customer experience – from our menu and service to our value and convenience – while giving more people more reasons to visit McDonald’s more often.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the third quarter, net income rose 8.6% and in the second quarter, the figure rose 15%.

The company has now topped analyst estimates for the last four quarters. It beat the mark by 2 cents in the third quarter, by 7 cents in the second quarter, and by one cent in the first quarter.

Revenue has risen the past four quarters. Revenue increased 13.7% to $7.17 billion in the third quarter. The figure rose 16.1% in the second quarter from the year earlier and climbed 8.9% in the first quarter from the year-ago quarter.

Looking Forward: Analysts appear increasingly optimistic about the company’s results for the next quarter. The average estimate for the first quarter of the next fiscal year has moved up from $1.23 a share to $1.24 over the last seven days. Over the past three months, the average estimate for the fiscal year has climbed from $5.20 per to share to $5.24.

Competitors to Watch: Chipotle Mexican Grill, Inc. , Good Times Restaurants Inc. , Carrols Restaurant Group, Inc. , Tim Hortons Inc. , Yum! Brands, Inc. , Jack in the Box Inc. , Panera Bread Company , Nathan’s Famous, Inc. , Wendy’s Arby’s Group Inc. , Starbucks Corporation , Sonic Corporation and Darden Restaurants .

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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