AllAnalyst Report
logoMorningstarOctober 12, 2020

McDonald's Corporation: McDonald's Postpandemic Investment Story Takes Shape Through New Promotions and Dividend Increase

Symbols
MCD
Sector(s)
Consumer Cyclical
Rating
Premium
Current Price
$218.33
Fair Value
Premium
Economic Moat
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Stewardship
Premium
Summary

McDonald's generates revenue through company-owned restaurants, franchise royalties, and licensing pacts. Restaurants offer a uniform value-priced menu with some regional variations. As of June 2020, there were roughly 39,000 locations in more than 120 countries: 36,400 franchisee/affiliate units and 2,600 company units. After reorganizing the company into segments based on the maturity and competitive position of its different markets, refranchising 4,000 locations, and eliminating $500 million in net annual SG&A expenses the past several years, the company is focused on "velocity growth accelerators" such as an Experience of the Future layout (counter, kiosk, web ordering and table service/curbside delivery), mobile ordering and payments, and delivery alternatives.

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