In the latest trading session, McDonald's (MCD) closed at $213.71, marking no change from the previous day. This move was narrower than the S&P 500's daily loss of 0.65%. Elsewhere, the Dow lost 0.42%, while the tech-heavy Nasdaq lost 0.46%.
Coming into today, shares of the world's biggest hamburger chain had gained 4.5% in the past month. In that same time, the Retail-Wholesale sector gained 5.76%, while the S&P 500 gained 4.11%.
MCD will be looking to display strength as it nears its next earnings release, which is expected to be July 26, 2019. In that report, analysts expect MCD to post earnings of $2.06 per share. This would mark year-over-year growth of 3.52%. Meanwhile, our latest consensus estimate is calling for revenue of $5.32 billion, down 0.62% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.02 per share and revenue of $21.03 billion. These totals would mark changes of +1.52% and +0.02%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for MCD. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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 0.28% higher within the past month. MCD currently has a Zacks Rank of #3 (Hold).
Investors should also note MCD's current valuation metrics, including its Forward P/E ratio of 26.65. This valuation marks a premium compared to its industry's average Forward P/E of 23.76.
We can also see that MCD currently has a PEG ratio of 3.07. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. MCD's industry had an average PEG ratio of 2.12 as of yesterday's close.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 83, which puts it in the top 33% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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