MCD - McDonald's Corporation

NYSE - NYSE Delayed Price. Currency in USD
+1.46 (+0.81%)
At close: 4:00PM EST
Stock chart is not supported by your current browser
Previous Close181.11
Bid0.00 x 1200
Ask0.00 x 1000
Day's Range180.94 - 183.26
52 Week Range146.84 - 190.88
Avg. Volume3,913,732
Market Cap140.745B
Beta (3Y Monthly)0.38
PE Ratio (TTM)27.74
Earnings DateN/A
Forward Dividend & Yield4.64 (2.56%)
Ex-Dividend Date2018-11-30
1y Target EstN/A
Trade prices are not sourced from all markets
  • Call for political action after Laquan McDonald cases
    Associated Press13 hours ago

    Call for political action after Laquan McDonald cases

    CHICAGO (AP) — Activists and others who were disappointed by the outcome of two historic cases involving the killing of black teenager Laquan McDonald by a white Chicago police officer see a way forward — by turning tragedy into political power.

  • This Chain Is Gaining on Taco Bell, Burger King, and Wendy's
    Motley Foolyesterday

    This Chain Is Gaining on Taco Bell, Burger King, and Wendy's

    McDonald's is still the king of fast food, but can you guess who's moving up the ranks fast?

  • Motley Fool2 days ago

    Big Deals and Snap Judgements

    Earnings, new deals, surprising news, and more.

  • Why Analysts Expect Starbucks’s EPS to Rise in Q1
    Market Realist2 days ago

    Why Analysts Expect Starbucks’s EPS to Rise in Q1

    Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?(Continued from Prior Part) Analysts’ EPS expectations Analysts expect Starbucks’s (SBUX) adjusted EPS to rise 11.9% to $0.65 in the first quarter of fiscal 2019 compared to $0.58

  • What Analysts Expect of Starbucks’s Revenue in Q1
    Market Realist2 days ago

    What Analysts Expect of Starbucks’s Revenue in Q1

    Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?(Continued from Prior Part)Analysts’ revenue expectationsIn the first quarter of fiscal 2019, analysts expect Starbucks (SBUX) to post revenue of $6.49 billion, a rise of 6.8% from

  • Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?
    Market Realist2 days ago

    Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?

    Can SBUX Overcome the Chinese Slowdown to Post Robust Q1 Results?SBUX’s performanceStarbucks (SBUX) is expected to post its fiscal 2019 first-quarter earnings results after the market closes on January 24.As of January 17, the company’s stock

  • Markit2 days ago

    See what the IHS Markit Score report has to say about Mcdonald's Corp.

    # Mcdonald's Corp ### NYSE:MCD View full report here! ## Summary * Perception of the company's creditworthiness is neutral * Bearish sentiment is low * Economic output in this company's sector is expanding ## Bearish sentiment Short interest | Positive Short interest is extremely low for MCD with fewer than 1% of shares on loan. This could indicate that investors who seek to profit from falling equity prices are not currently targeting MCD. ## Money flow ETF/Index ownership | Neutral ETF activity is neutral. The net inflows of $11.70 billion over the last one-month into ETFs that hold MCD are not among the highest of the last year and have been slowing. ## Economic sentiment PMI by IHS Markit | Positive According to the latest IHS Markit Purchasing Managers' Index (PMI) data, output in the Consumer Services sector is rising. The rate of growth is strong relative to the trend shown over the past year, and is accelerating. ## Credit worthiness Credit default swap | Neutral The current level displays a neutral indicator. MCD credit default swap spreads are decreasing, indicating some improvement in the market's perception of the company's credit worthiness. Additionally, they are within the middle of the range set over the last three years. Please send all inquiries related to the report to Charts and report PDFs will only be available for 30 days after publishing. This document has been produced for information purposes only and is not to be relied upon or as construed as investment advice. To the fullest extent permitted by law, IHS Markit disclaims any responsibility or liability, whether in contract, tort (including, without limitation, negligence), equity or otherwise, for any loss or damage arising from any reliance on or the use of this material in any way. Please view the full legal disclaimer and methodology information on pages 2-3 of the full report.

  • Judge acquits 3 Chicago officers of Laquan McDonald cover-up
    Associated Press3 days ago

    Judge acquits 3 Chicago officers of Laquan McDonald cover-up

    CHICAGO (AP) — A judge on Thursday acquitted three Chicago officers of trying to cover up the 2014 shooting of Laquan McDonald, dismissing as just one perspective the shocking dashcam video of the black teenager's death that led to protests, a federal investigation of the police department and the rare murder conviction of an officer.

  • McDonald's (MCD) Outpaces Stock Market Gains: What You Should Know
    Zacks3 days ago

    McDonald's (MCD) Outpaces Stock Market Gains: What You Should Know

    McDonald's (MCD) closed at $181.11 in the latest trading session, marking a +0.98% move from the prior day.

  • Trump’s Burger King, McDonald’s binge scores fast food companies over $15 million in free ad impressions
    Yahoo Finance4 days ago

    Trump’s Burger King, McDonald’s binge scores fast food companies over $15 million in free ad impressions

    President Trump serving fast food at the Clemson Tigers' White House visit was a big win for McDonald's and Burger King.

  • 7 Stocks to Buy as the Dollar Weakens
    InvestorPlace4 days ago

    7 Stocks to Buy as the Dollar Weakens

    The financial markets had a turbulent and volatile 2018, with many storylines and themes changing multiple times over the course of the year. But one financial market theme that remained constant through the volatility was a strong dollar. The U.S. Dollar Index, which measures the strength of the U.S. dollar against a basket of foreign currencies, bottomed around 90 in early 2018 during global financial market turmoil. Over the rest of the year, the U.S. Dollar Index steadily gained towards the upper 90's, even amid the big selloff in late 2018. This trend has changed course over the past month. Specifically, the U.S. Dollar Index peaked around 98 in mid-December, and has since consistently fallen towards 95, its lowest level since October. Why? There's renewed optimism regarding a trade war resolution, and hope that while the global economy is slowing, it's not slowing as much as feared. Also, the Fed has grown increasingly dovish over the past few weeks, signalling fewer rate hikes than previously anticipated. InvestorPlace - Stock Market News, Stock Advice & Trading Tips But a weaker dollar is good news for some companies, such as multinationals with significant overseas sales exposure and foreign stocks with mitigated sales exposure to the U.S. Many of these stocks were hampered by a strong dollar in 2018. But, if the dollar continues to weaken in 2019, these stocks could have room to run higher as a major headwind is removed from the equation. * 10 Growth Stocks With the Future Written All Over Them With this in mind, let's take a look at seven stocks to buy as the U.S. dollar weakens. ### Stocks to Buy as the Dollar Weakens: McDonald's (MCD) Source: Shutterstock At the top of the list is McDonald's (NYSE:MCD), the multinational food giant which not only gets a majority of its revenue and profits from international markets, but whose international operations are also more profitable and growing faster. Therefore, as the dollar weakens and those businesses start to earn more in term of U.S. dollars, MCD stock should benefit. Last year, roughly 65% of the company's total revenues and nearly 60% of total operating profits came from outside of the U.S. Moreover, comparable sales growth in the U.S. was just 3.6% last year, versus 5% and up overseas. Also, U.S. company operated margins hovered around 16% in 2017. International company operated margins were north of 17%. Overall, as goes the international business, so goes McDonald's. Thus, as the international business becomes increasingly valuable against a weakening dollar, MCD stock should naturally rise. ### Stocks to Buy as the Dollar Weakens: Alibaba (BABA) Source: Shutterstock The plunge in Chinese stocks started in early 2018, when the U.S. dollar strengthened significantly against the Chinese yuan. That strengthening diluted the value of U.S. listed Chinese stocks, and that dilution -- on top of concerns regarding weakening growth -- caused all Chinese stocks to drop in a big way. That included shares of Chinese internet giant Alibaba (NYSE:BABA). But the fundamentals underlying Alibaba remain very strong. This is still the premiere e-commerce and cloud company in a 6%-plus growth economy supported by healthy demographic trends. Despite those tailwinds, the stock now trades at a rather anemic sub-30x forward multiple (revenues grew by over 50% last quarter). * 7 Oversold Small-Cap Stocks With Massive Profit Growth All this stock needs to explode higher is a few good catalysts. One such catalyst is a weakening dollar. The other is positive progress on U.S.-China trade talks. Those two are tied together, and both are starting to move in favor of Alibaba. As such, now seems like as good a time as any for a big BABA stock around. ### Stocks to Buy as the Dollar Weakens: Baidu (BIDU) Source: Shutterstock Another Chinese stock that plunged with a strengthening U.S. dollar but is now set to rebound as the dollar weakens is Baidu (NASDAQ:BIDU). For those who are unaware, Baidu is the company behind China's leading search engine, and as such, is often called the Google (NASDAQ:GOOG) of China. As the Google of China, Baidu has established itself as the backbone of China's burgeoning internet economy. There have been some hiccups in the road, but the company has always successfully navigated around them and -- much like Google- - Baidu has found itself as a largely consistent 20%-plus revenue grower. At current levels, BIDU stock is pretty cheap with a mere 15x forward multiple. Google trades at over 20x forward earnings, and Google is growing revenues at a slower clip than Baidu. Thus, the 15x forward multiple on BIDU stock doesn't make much sense and should ultimately be corrected with a few positive catalysts. One such positive catalyst will be the weakening of the U.S. dollar. If dollar weakness persists and U.S.-China trade talks continue to make progress towards a resolution, BIDU stock could be in store for a major rally from multi-year lows. ### Stocks to Buy as the Dollar Weakens: Coca Cola (KO) Source: Coca-Cola One multinational giant that is set to benefit in a sizable way from U.S. dollar weakness is Coca Cola (NYSE:KO). Much like McDonald's, most of Coca-Cola's revenues, profits, and growth come from international markets. Specifically, last year, only ~25% of the company's revenues came from North America. Presumably, most of that was from the United States. Still, at most, the U.S. represented just about 20% of Coca-Cola's total revenues in 2017. Roughly a third of operating profits came from North America, so maybe about 25% came from the U.S. Meanwhile, volume growth in North America was flat, while it was positive in some other international geographies. * Top 10 Global Stock Ideas for 2019 From RBC Capital Broadly speaking, then, the KO growth story is one led and driven by international growth. As the dollar weakens, that international growth becomes more valuable in terms of U.S. dollars, and the entire KO growth story becomes more valuable, too. As such, dollar weakness should lead to a KO stock rally. ### Stocks to Buy as the Dollar Weakens: Netflix (NFLX) Source: Shutterstock Although this stock is often viewed as being in a different category than McDonald's and Coca Cola, streaming giant Netflix (NASDAQ:NFLX) actually shares a few prominent parallels with the aforementioned consumer staples giants. Namely, all three are international driven growth stories that benefit from a weaker dollar. Netflix is still growing by leaps and bounds in the U.S. But, the majority of the growth is happening outside of the U.S. Last quarter, the U.S. streaming business grew revenues by 25% with just over 1 million net ads. In contrast, the international streaming business grew revenues by nearly 50% with almost 6 million net ads. Also, when investors and analysts talk about how big Netflix can be, those discussions almost entirely revolve around the international market, since the consensus belief is that the U.S. market is nearing saturation. Overall, Netflix is a multinational giant with an international driven growth story. As such, this company and stock are winners when the dollar weakens. ### Stocks to Buy as the Dollar Weakens: Tesla (TSLA) Source: Tesla When talking about growth giants with international driven growth stories, streaming giant Netflix and electric vehicle pioneer Tesla (NASDAQ:TSLA) fall into the same boat. Tesla had a breakthrough back half of 2018 as the company achieved a sizable profit for the first time in several years -- and did so while accelerating Model 3 production and delivery to mainstream levels. But all those positive developments happened almost entirely on the domestic front. The Model 3 has yet to really scratch the surface internationally. * 5 Fallen-Angel Stocks That Have Been Oversold That will change in 2019. One of Tesla's biggest focus is producing and delivering Model 3 vehicles all around the world this year. As the company does this, the TSLA growth narrative will become increasingly internationally driven. The more internationally driven this growth narrative becomes, the more a weak dollar will help TSLA stock. ### Stocks to Buy as the Dollar Weakens: Weibo (WB) Source: Shutterstock Back to the list of Chinese stocks to buy before they benefit from a weaker dollar. There is a lesser known but just as compelling Chinese stock: social-media giant Weibo (NASDAQ:WB). Many investors and analysts like to call Weibo the Twitter (NYSE:TWTR) of China, given overlaps in the companies' core social media platforms. Those comparisons make sense. But, Weibo is much bigger (nearly 450 million monthly active users versus under 330 million at Twitter). Weibo is also growing more quickly (44% revenue growth last quarter, versus 29% at Twitter), and is more profitable (42% adjusted EBITDA margins last quarter, versus 39% at Twitter). Despite Weibo being bigger, faster growing, and more profitable, Twitter stock is deemed more valuable and expensive by the market. Weibo has a $12 billion market cap. Twitter is valued at essentially twice that. Weibo stock trades at 17 forward earnings. Twitter's forward multiple is above 35. Overall, Weibo stock is just way too cheap to ignore here. And all it will take for a rip-your-face-off rally is a few positive catalysts. A weakening U.S. dollar is one. Positive trade talks is another. Stabilizing economic growth in China is a third. If all those boxes get checked off, this stock could soar in a big way. As of this writing, Luke Lango was long BIDU, GOOG, NFLX, TSLA, WB, and TWTR. ### More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * Top 10 Global Stock Ideas for 2019 From RBC Capital * 10 A-Rated Stocks the Smart Money Is Piling Into * 5 Best Bank ETFs for This Week's Earnings Avalanche Compare Brokers The post 7 Stocks to Buy as the Dollar Weakens appeared first on InvestorPlace.

  • Your first trade for Wednesday, January 16
    CNBC4 days ago

    Your first trade for Wednesday, January 16

    The "Fast Money" traders share their first moves for the market open.

  • CNBC4 days ago

    Stocks making the biggest moves premarket: FDC, BAC, GS, BLK & more

    Bank of America reported quarterly profit of 70 cents per share, 7 cent a share above estimates. Goldman Sachs GS – Goldman reported quarterly profit of $6.04 per share, well above the consensus estimate of $4.45 a share. BlackRock BLK – The asset management giant reported adjusted quarterly profit of $6.08 per share, below the consensus estimate of $6.27 a share.

  • Reuters5 days ago

    McDonald's loses 'Big Mac' trademark case to Irish chain Supermac's

    The judgment, provided to Reuters by Supermac's, revoked McDonald's registration of the trademark, saying that the world's largest fast-food chain had not proven genuine use of it over the five years prior to the case being lodged in 2017.

  • Reuters5 days ago

    PRESS DIGEST- British Business - Jan 16

    The following are the top stories on the business pages of British newspapers. - British PM Theresa May was under mounting pressure last night to delay Brexit after she suffered the largest Commons defeat in British political history. - Relx, the FTSE 100 media group, has acquired the St Albans-based Mack Brooks Exhibitions, an arranger of corporate jamborees.

  • Reuters5 days ago

    McDonald's loses 'Big Mac' trademark case to Irish chain Supermac's

    The judgment, provided to Reuters by Supermac's, revoked McDonald's registration of the trademark, saying that the world's largest fast-food chain had not proven genuine use of it over the five years prior to the case being lodged in 2017.

  • 3 Top Restaurant Stocks to Watch in January
    Motley Fool5 days ago

    3 Top Restaurant Stocks to Watch in January

    Investors should keep an eye on Shake Shack, Wingstop, and McDonald's this month.

  • CNBC5 days ago

    McDonald's loses EU trademark battle over the Big Mac

    McDonald's has lost its trademark for its Big Mac burger in the European Union.

  • Trump trolled for Clemson fast food dinner, but Warren Buffett and others are fans of junk food too
    CNBC5 days ago

    Trump trolled for Clemson fast food dinner, but Warren Buffett and others are fans of junk food too

    Donald Trump served Clemson players a buffet of McDonald's, Wendy's and Burger King at the White House. Twitter is largely aghast, but billionaires like Bill Gates and Warren Buffett also love fast food. Even Speaker of the House Nancy Pelosi indulges.

  • Moody's5 days ago

    Arcos Dorados Holdings Inc. -- Moody's upgrades Arcos Dorados to Ba2; stable outlook

    The upgrade of Arcos Dorados' ratings to Ba2 reflects primarily the improvement in operating performance, with revenue growth (in constant currency) in all regions, margin improvement and continued investments in expansion, modernization and innovation. Accordingly, adjusted EBITDA and operating margins are at the highest level since 2013 (15.9% and 8.3%, respectively, in LTM ended September 2018), an expansion that started in 2016, despite the challenging macroeconomic environment in Arcos Dorados' main markets -- namely Brazil and Argentina - and also in Venezuela.

  • InvestorPlace5 days ago

    History Says That Chipotle Stock Is a Sell Above $500

    Enormous volatility in shares of Mexican fast casual eatery Chipotle (NYSE:CMG) has created tremendous buying and selling opportunities in Chipotle stock over the past year. First, Chipotle stock fell to $250 in February 2018. That was an opportunity to buy. Then, CMG nearly doubled by August and eclipsed the $500 mark. That was the time to sell. It fell all the way back nearly $400 by October. That was another buying opportunity. It rallied back to nearly $500 in December. Time to sell again. Then, it dropped to below $400, which was yet another opportunity to buy. InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 8 Dividend Stocks With Growth on the Horizon Now, CMG has again rallied to above $500. This big rally above $500 will end no differently than prior similar rallies. It will inevitably fade. Quite simply, the fundamentals don't support a $500 price tag for Chipotle stock just yet, while the technicals indicate that the stock is overbought in the near term and due for a pullback. In other words, this is another opportunity to sell the rally in Chipotle stock. Eventaully, CMG will rally above $500 and hold that level. But, not today. Today, this stock should ultimately fall back into the $400's relatively soon. ### Chipotle Has Healthy Drivers When it comes to the qualitative growth narrative underlying Chipotle stock, you have some good and some bad. On the good side, Chipotle's comparable sales growth trajectory is turning around and margins are finally rebounding. This is due to multiple company-specific initiatives that have reinvigorated growth. Namely, the company is aggressively expanding its presence in the digital food ordering and delivery market, which is a red hot market that is still growing by leaps and bounds. Also, Chipotle is innovating on its menu for the first time in a long time. In so doing, the company is bringing in new customers through new items like diet lifestyle bowls. Alongside these new innovations, the Chipotle brand has also finally developed a voice for itself through a unique "Get Real" marketing campaign that emphasizes the authenticity and uniqueness of Chipotle's food ingredients and preparation. All of these developments are positive for Chipotle stock. They should drive continued positive comparable sales growth and margin expansion for the foreseeable future, and keep Chipotle relevant in the crowded quick service restaurant space. ### There Are Big Risks, Too On the bad side, the crowded quick service restaurant(QSR) space is only getting more crowded. McDonald's (NYSE:MCD), long known for producing what the public perceived as "cheap" food, is stepping up its game on the health front by rolling out fresh beef patties and eliminating antibiotics from its global supply chain. Movements like these, which are happening everywhere and not just at McDonald's, somewhat erode Chipotle's moat as a unique fresh food QSR. Also, the poke and acai bowl trends remain the fad in the healthy QSR space , meaning that Chipotle's burritos continue to lose share among health-oriented consumers. Wage pressures are also picking up, with inflation and wage growth hitting multi-year highs, and that's a major headwind for margins. It's also worth mentioning that Amazon (NASDAQ:AMZN) is making a big push in the QSR and convenience store space with cashier-less convenience stores, and that is a potential long term threat for Chipotle. Overall, the Chipotle narrative has some good, and some bad. Above $500, Chipotle stock reflects just the good, and that makes the stock unnecessarily risky. ### Chipotle Stock Isn't Supported Above $500 When it comes to the fundamentals underlying CMG, they are, much like the narrative, a mixed bag. Comparable sales growth trends are improving and running in the positive mid-single-digit range. But, all of that growth is from price hikes, not traffic growth. That isn't sustainable. Eventually, price hikes will run their course. Once they do, comparable sales growth will normalize lower. They will likely settle in the low-single-digit range. LSD comps plus some unit expansion should drive ~7.5% revenue growth per year over the next several years. Margins are trending higher. This will continue because they are rebounding from a depressed base. But, restaurant level margins are up only 170 basis points year-to-date to 19.3%. I say "only" because, at their peak, RLMs were above 27%. Chipotle won't get back to those RLMs. Average unit volumes likely won't eclipse their previous peak, and even if they do, it will be because of price hikes and not traffic. If prices are going up, that usually means wages and other costs are going up, too. Thus, it's net neutral on the margin line. Going forward, Chipotle is a company characterized by sub-10% revenue growth and mild margin expansion. In combination, that should realistically drive earnings per share to $30 by 2023. A restaurant average 22 forward multiple on that implies a fiscal 2022 price target of $660. Discounted back by 10% per year, that equates to a fiscal 2019 price target of just under $500. Chipotle stock is currently above $500. Thus, the stock is already trading above a reasonable 12 month forward price target. That's an unfavorable position to be in, fundamentally speaking. Also, due to the huge rally from below $400 to above $500 in about two weeks, CMG is entering technically overbought territory ahead of earnings. The Relative Strength Index (RSI) on the stock is above 70, or in overbought territory. The stock price is also more than 10% above its 50-day moving average, a large divergence which historically implies a near term peak. ### Bottom Line on CMG Stock Long term, Chipotle stock will be just fine. But, in the near term, this stock is both fundamentally overvalued and technically overbought. That combination implies a bearish outlook for CMG over the next few weeks, and I wouldn't be surprised to see this stock fall back into the $400's relatively soon. As of this writing, Luke Lango was long AMZN. ### More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Companies That Could Post Decelerating Profits * 10 A-Rated Stocks the Smart Money Is Piling Into * Mizuho: 7 Long-Term Value Stocks to Buy Now Compare Brokers The post History Says That Chipotle Stock Is a Sell Above $500 appeared first on InvestorPlace.

  • CNBC6 days ago

    Bernie Sanders picks a new fight over $15 minimum wage as he explores running for president in 2020

    The bill will likely die in Congress even as it gives Sanders a key issue to push on the campaign trail if he runs for president in the 2020 race, as he is widely expected to.

  • InvestorPlace6 days ago

    Apple’s Warning Is a Reason to Avoid Starbucks Stock

    Did you hear that? That was the world's largest company, Apple (NASDAQ:AAPL), firing a warning shot about slowing growth in the world's hottest economy, China. Everyone heard the shot when it was first fired on January 2. Stocks across the board dropped. But now, less than two weeks later, everyone has seemingly forgotten about that warning shot, and stocks are in rally mode. That's fair. Stocks, by and large, are undervalued, and other risk factors are improving, such as the Fed becoming more dovish and U.S.-China trade talks progressing nicely. But, China's economy is still cooling, and that's bad news for companies with broad exposure to China, regardless of how other risk factors are playing out. One such company is retail coffee giant Starbucks (NASDAQ:SBUX). For all intents and purposes, due to dried up growth everywhere else, the Starbucks stock growth narrative is entirely centered around China. Given Apple's warning shot, that's a worrisome position to be in. Indeed, Goldman Sachs recently downgraded Starbucks stock to Neutral due to the company's broad exposure to the slowing China economy. Goldman actually warns that Starbucks could issue a warning like Apple about slowing growth in the near future. InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks to Buy That Are Run By Billionaires Goldman hit the nail on the head with this downgrade. To warrant its current valuation, Starbucks stock needs everything to go right. But, because of Apple's warning, we know everything isn't going right in the most important region for the coffee giant. Thus, the current valuation seems due for compression based on weakening growth trends, and that's reason enough to stay away from Starbucks stock in the near term. ### Worrisome Exposure To China The core of the near-term bear thesis on Starbucks stock is that the company has a worrisome level of exposure to China, and that if growth in China falls apart, SBUX's long-term growth narrative will substantially weaken, causing the stock to drop meaningfully. It's not all bad news in China, though. This is still a 6%-plus growth economy. And, while Apple recently issued a big warning about slowing growth in China, Nike (NYSE:NKE) announced two weeks prior that its China business was red hot. My fear, however, is that Starbucks is on the Apple path in China, not the Nike path. Over the past several quarters, Nike's business has been heating up globally. Apple's business has been cooling. So has Starbucks' business. Thus, Nike's ability to maintain strong growth in China is more a function of outstanding operational momentum than anything else. Starbucks doesn't have that. Instead, Starbucks is more comparable to Apple in that growth is positive, but slowing from its multi-year trend. From this perspective, the present situation for Starbucks in China is most likely one defined by slowing growth. That's a big problem. Growth everywhere else is all dried up due to rising competition and saturation. Comparable sales growth in the U.S. has dropped from 5% and up a few years back, to 2% last year, with transaction volume actually down year-over-year. Europe, Middle East, and Africa comps have followed a similar trajectory, also with negative transaction volume growth last year. Thus, the SBUX growth narrative is all about China. If China falls apart, so does this growth narrative, meaning that if China numbers are weak next quarter (as they should be), then Starbucks stock will drop meaningfully. ### Valuation Has Room To Fall In relation to what is likely substantial sales pressure in China, the valuation on Starbucks stock is a tough pill to swallow. Starbucks stock trades at 24x forward earnings. That's below the stock's five-year forward multiple of 25. But, the company is also growing much less quickly today than it has over the past five years. Thus, a lower valuation is warranted. With respect to its peers, that 24 forward multiple actually seems stretched. The forward P/E multiple across the whole restaurant industry hovers right around 22. McDonald's (NYSE:MCD) trades at 22x forward earnings. Dunkin' (NYSE:DNKN) trades at 23x forward earnings. Yum (NYSE:YUM), Jack In The Box (NASDAQ:JACK), and El Pollo Loco (NASDAQ:LOCO) all trade around 18 to 23x forward earnings. Thus, relative to other mid-to-large cap restaurant names with fairly slow but stable growth, Starbucks stock still trades at a premium -- despite worrisome exposure to China. That means that if China's numbers do come in below expectations, SBUX stock could get hit by sizable valuation compression. * 10 A-Rated Stocks the Smart Money Is Piling Into ### Bottom Line on SBUX Stock Starbucks stock is a solid long-term holding given the company's staying power in a stable growth global retail coffee industry. But, at the present moment, the valuation seems overstretched with sizable operational risks on the horizon. That means the near to medium term outlook for this stock skews bearish, despite stable long term fundamentals. As of this writing, Luke Lango was long AAPL and NKE. ### More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Key Emerging-Market Stocks to Buy for Contrarian Investors * 7 Stocks at Risk of the Global Smartphone Slowdown * 7 Pharmaceutical Stocks That Just Raised Prices This Year Compare Brokers The post Apple's Warning Is a Reason to Avoid Starbucks Stock appeared first on InvestorPlace.

  • Chicago cop sentenced to more than six years for Laquan McDonald murder
    Reuters Videos2 days ago

    Chicago cop sentenced to more than six years for Laquan McDonald murder

    A judge sentences former Chicago police officer Jason Van Dyke to more than six years in prison, after a jury found him guilty of murder last year in the 2014 shooting of black teenager Laquan McDonald. Jillian Kitchener reports.

  • McDonald's loses 'Big Mac' case against Irish rival
    Reuters Videos4 days ago

    McDonald's loses 'Big Mac' case against Irish rival

    McDonald’s Corp has lost its rights to the trademark “Big Mac” in a European Union case ruling in favor of Ireland-based fast-food chain Supermac’s, according to a decision by European regulators. Edward Baran reports.