McDonald's (MCD) closed at $197.55 in the latest trading session, marking a -0.54% move from the prior day. This move was narrower than the S&P 500's daily loss of 1.23%. Elsewhere, the Dow lost 1.31%, while the tech-heavy Nasdaq lost 2.29%.
Coming into today, shares of the world's biggest hamburger chain had gained 7.78% in the past month. In that same time, the Retail-Wholesale sector gained 9.75%, while the S&P 500 gained 5.2%.
MCD will be looking to display strength as it nears its next earnings release, which is expected to be July 28, 2020. In that report, analysts expect MCD to post earnings of $0.76 per share. This would mark a year-over-year decline of 62.93%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.65 billion, down 31.64% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $5.83 per share and revenue of $18.62 billion, which would represent changes of -25.64% and -11.63%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for MCD. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 2.85% higher. MCD is currently a Zacks Rank #3 (Hold).
Investors should also note MCD's current valuation metrics, including its Forward P/E ratio of 34.06. Its industry sports an average Forward P/E of 43.94, so we one might conclude that MCD is trading at a discount comparatively.
It is also worth noting that MCD currently has a PEG ratio of 4.64. 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. Retail - Restaurants stocks are, on average, holding a PEG ratio of 5.04 based on yesterday's closing prices.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 71, which puts it in the top 28% 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.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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McDonalds Corporation (MCD) : Free Stock Analysis Report
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