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1. Company Snapshot

1.a. Company Description

McDonald's Corporation operates and franchises McDonald's restaurants in the United States and internationally.Its restaurants offer hamburgers and cheeseburgers, chicken sandwiches and nuggets, wraps, fries, salads, oatmeal, shakes, desserts, sundaes, soft serve cones, bakery items, soft drinks, coffee, and beverages and other beverages, as well as breakfast menu, including biscuit and bagel sandwiches, breakfast burritos, hotcakes, and other sandwiches.As of December 31, 2021, the company operated 40,031 restaurants.


McDonald's Corporation was founded in 1940 and is headquartered in Chicago, Illinois.

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1.b. Last Insights on MCD

McDonald's recent performance was driven by strong Q2 earnings and revenue beat, fueled by solid demand across its global markets and ongoing investments in digital and menu innovation. The company's focus on value offerings, including reduced combo meal prices, is expected to drive top-line gains and improve affordability for budget-conscious shoppers. Additionally, McDonald's strategic progress in international operations and renewed focus on everyday value are positioning the company to gain market share and deliver stable earnings in a volatile macro environment. The company's digital growth and menu innovation are also expected to drive top-line gains, with the launch of a new online ordering experience in partnership with DoorDash.

1.c. Company Highlights

2. McDonald's Delivers Strong Earnings Growth, Driven by Compelling Value and Marketing Innovation

McDonald's reported a strong financial performance in 2025, with system-wide sales reaching nearly $140 billion, up 5.5% in constant currency for the full year. The company's fourth-quarter comp sales grew by 5.7%, driven by positive comparable guest counts. Adjusted earnings per share (EPS) came in at $3.12, beating estimates of $3.05. The total adjusted operating margin for the full year was 46.9%, in line with expectations. Revenue growth was driven by a combination of solid comp sales growth, new restaurant openings, and effective marketing initiatives.

Publication Date: Feb -12

📋 Highlights
  • 2025 System-Wide Sales:: Reached nearly $140 billion, up 5.5% in constant currency, driven by over 3% comp sales growth and 5.5% growth in Q4.
  • New Restaurant Openings:: 2,275 new restaurants in 2025, with 2,600 expected in 2026 (750 in U.S./IOM, 1,000 in China via IDL).
  • Marketing Success:: Grinch campaign sold 50 million socks globally and set a single-day sales record, while Minecraft collaboration was the largest global campaign.
  • Operating Margin Expansion:: 2025 adjusted operating margin of 46.9%, with 2026 guidance at mid- to high 40% range, reflecting sales-driven margin improvement.
  • Capital Expenditures:: 2026 capex projected at $3.7–$3.9 billion, up $1.5 billion from 2023, to support 2,600 new units and tech/digital investments.

Segment Performance and Marketing Efforts

The company's marketing efforts were successful, with campaigns such as the Minecraft movie collaboration and the Grinch campaign exceeding expectations. The Grinch Meal set new sales records, including the highest single sales day in the company's history, with nearly 50 million pairs of Grinch-themed socks sold globally. As Chris Kempczinski noted, "We've relaunched extra value meals in the U.S. and seen improvements in low-income share and value and affordability experience scores." The company's focus on value, marketing innovation, and menu innovation has enabled it to outperform in any environment.

Growth Prospects and Capital Allocation

Looking ahead to 2026, McDonald's expects to continue its momentum, with net restaurant expansion contributing approximately 2.5% to system-wide sales growth. The company plans to open around 2,600 gross restaurants, with a capital expenditure spend of between $3.7 billion and $3.9 billion. McDonald's prioritizes its dividend, which has increased in each of the last 49 years, and repurchases shares with remaining free cash flow over time. Analysts estimate revenue growth at 5.4% for next year.

Valuation and Return Metrics

With a P/E Ratio of 27.38 and an EV/EBITDA of 19.72, the market appears to have priced in McDonald's growth prospects. The company's ROIC is 16.73%, indicating efficient capital allocation. The Dividend Yield is 2.22%, providing a relatively stable return for investors. As McDonald's continues to innovate and expand its operations, its valuation multiples will be closely watched to determine if the current price reflects the company's growth potential.

3. NewsRoom

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Market Today: Moderna rebounds; oil and gold jump

Feb -18

Source: gurufocus.com

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Find Your Balance: 3 Stocks With Incredibly Durable Cash Flow, Dividends, Value and Growth

Feb -18

Source: 247wallst.com

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McDonald’s (NYSE:MCD) CEO Christopher Kempczinski Sells 26,277 Shares

Feb -18

Source: defenseworld.net

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McDonald’s (NYSE:MCD) CEO Christopher Kempczinski Sells 26,276 Shares of Stock

Feb -18

Source: defenseworld.net

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MCD and TXRH: 2 Low-Risk Restaurant Stocks With Upside

Feb -17

Source: marketbeat.com

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3 Once-In-A-Decade REIT Opportunities To Win Big

Feb -17

Source: seekingalpha.com

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Dividend Income: Lanny's December 2025 Summary

Feb -17

Source: seekingalpha.com

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Assetmark Inc. Raises Holdings in McDonald’s Corporation $MCD

Feb -16

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.00%)

6. Segments

International Operated Markets

Expected Growth: 5.0%

McDonald's international operated markets driven by digital transformation and menu innovation

U.S.

Expected Growth: 2.5%

Driven by digital transformation and menu innovation, McDonald's U.S. segment is expected to grow

International Developmental Licensed Markets & Corporate

Expected Growth: 5.2%

Increasing demand in international licensed markets and corporate operations drives growth

7. Detailed Products

Hamburgers

McDonald's offers a variety of hamburgers, including the iconic Big Mac, Quarter Pounder, and Cheeseburger. These sandwiches typically consist of a cooked patty of ground beef, served on a bun with lettuce, cheese, pickles, and condiments.

Chicken Sandwiches

McDonald's chicken sandwiches, such as the McChicken and McChicken Biscuit, feature a breaded and fried chicken patty served on a bun with lettuce, cheese, and condiments.

Breakfast Items

McDonald's offers a range of breakfast items, including the Egg McMuffin, Sausage Biscuit, and Hotcakes. These items typically feature eggs, meat, and cheese served on a bun or with syrup.

Salads

McDonald's offers a variety of salads, including the Southwest Buttermilk Crispy Chicken Salad and the Bacon Ranch Grilled Chicken Salad. These salads feature mixed greens, vegetables, and often grilled chicken or crispy chicken strips.

Fries and Sides

McDonald's fries are a popular side dish, cooked to a crispy golden brown. The company also offers other sides, such as Apple Slices and Side Salads.

Desserts

McDonald's offers a range of desserts, including the iconic Apple Pie, McFlurry, and Ice Cream Cone. These sweet treats are often served as a finishing touch to a meal.

Beverages

McDonald's offers a variety of beverages, including soft drinks (such as Coca-Cola and Sprite), coffee, tea, and juice. The company also offers a range of specialty drinks, such as milkshakes and frappes.

8. McDonald's Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for McDonald's is moderate due to the presence of alternative fast-food chains and healthier dining options. However, McDonald's has a strong brand and customer loyalty, which mitigates this threat to some extent.

Bargaining Power Of Customers

Customers have a high bargaining power due to the abundance of fast-food options and the ease of switching to competitors. Additionally, customers are increasingly demanding healthier and more sustainable options, which can pressure McDonald's to adapt to these changing preferences.

Bargaining Power Of Suppliers

McDonald's has a large and diverse supply chain, which reduces the bargaining power of individual suppliers. The company's significant purchasing volume and long-term contracts also give it negotiating leverage with suppliers.

Threat Of New Entrants

The threat of new entrants in the fast-food industry is relatively low due to the high barriers to entry, including significant capital requirements, established brand recognition, and complex supply chain logistics. However, new entrants can still disrupt the market with innovative concepts or technologies.

Intensity Of Rivalry

The fast-food industry is highly competitive, with numerous established players and new entrants vying for market share. McDonald's faces intense competition from other fast-food chains, such as Burger King, Wendy's, and KFC, as well as from newer, trendy concepts and meal delivery services.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 107.88%
Debt Cost 4.00%
Equity Weight -7.88%
Equity Cost 6.97%
WACC 3.76%
Leverage -1368.49%

11. Quality Control: McDonald's Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
McDonald's

A-Score: 6.0/10

Value: 3.6

Growth: 4.7

Quality: 6.5

Yield: 4.0

Momentum: 7.0

Volatility: 10.0

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Yum!

A-Score: 5.9/10

Value: 4.0

Growth: 4.7

Quality: 6.4

Yield: 4.0

Momentum: 7.0

Volatility: 9.3

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PulteGroup

A-Score: 5.8/10

Value: 6.0

Growth: 8.8

Quality: 7.7

Yield: 2.0

Momentum: 4.0

Volatility: 6.3

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Booking

A-Score: 5.8/10

Value: 3.6

Growth: 8.7

Quality: 8.0

Yield: 1.0

Momentum: 5.0

Volatility: 8.3

1-Year Total Return ->

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Starbucks

A-Score: 5.0/10

Value: 3.3

Growth: 5.6

Quality: 4.5

Yield: 5.0

Momentum: 4.0

Volatility: 7.3

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Chipotle Mexican Grill

A-Score: 3.8/10

Value: 1.2

Growth: 8.4

Quality: 5.9

Yield: 0.0

Momentum: 1.0

Volatility: 6.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

327.89$

Current Price

327.89$

Potential

-0.00%

Expected Cash-Flows