WEN - $5 Meal Frenzy Not Enough? Why This Analyst Sees Appetite for McDonald's Stock Despite Value War | Benzinga
McDonald’s Corp. (NYSE:MCD) shares are down year-to-date despite the fast-food chain being counted among defensive stocks, which typically generate decent returns even when the economy is going through a downturn. An analyst at KeyBanc Capital Markets on Friday weighed in on what’s ailing the stock.
The McDonald’s Analyst: Eric Gonzalez reiterated an Overweight rating and $310 price target for the shares of McDonald’s, suggesting scope for about 23% upside.
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The 15% year-to-date decline in McDonald’s stock vis-a-vis roughly flat performance for its peer group and the 10% gain for the S&P 500 Index, is uncharacteristic of a brand that has proven resilient through cycles, said Gonzalez in the note.
The stock’s underperformance is attributable to softening global same-store sales trends, including in the U.S., the analyst said, adding that this was the result of consumers getting more circumspect.
Citing proprietary data and industry conversations, the analyst lowered his second-quarter same-store sales estimate for McDonald’s U.S. from 1% to 0%. The year-over-year comparisons for the quarter will likely remain difficult, as it laps the "Grimace Birthday Shake", which went viral last June, ...