MCDONALD'S CORP (MCD) Stock Fundamental Analysis
USA • New York Stock Exchange • NYSE:MCD • US5801351017
317.955 USD
+2.95 (+0.94%)
Last: Feb 2, 2026, 12:03 PM
MCD gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 132 industry peers in the Hotels, Restaurants & Leisure industry. MCD has an excellent profitability rating, but there are some minor concerns on its financial health. MCD is quite expensive at the moment. It does show a decent growth rate. MCD also has an excellent dividend rating. These ratings would make MCD suitable for dividend investing!
1. Profitability
1.1 Basic Checks
- MCD had positive earnings in the past year.
- MCD had a positive operating cash flow in the past year.
- Each year in the past 5 years MCD has been profitable.
- MCD had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- MCD has a better Return On Assets (13.88%) than 90.91% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 17.77%, MCD belongs to the top of the industry, outperforming 89.39% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for MCD is significantly above the industry average of 10.38%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.88% | ||
| ROE | N/A | ||
| ROIC | 17.77% |
ROA(3y)14.08%
ROA(5y)13.05%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)18.38%
ROIC(5y)16.68%
1.3 Margins
- MCD has a Profit Margin of 32.04%. This is amongst the best in the industry. MCD outperforms 97.73% of its industry peers.
- In the last couple of years the Profit Margin of MCD has grown nicely.
- Looking at the Operating Margin, with a value of 46.12%, MCD belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
- MCD's Operating Margin has improved in the last couple of years.
- MCD has a Gross Margin of 57.43%. This is in the better half of the industry: MCD outperforms 72.73% of its industry peers.
- In the last couple of years the Gross Margin of MCD has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 46.12% | ||
| PM (TTM) | 32.04% | ||
| GM | 57.43% |
OM growth 3Y2.46%
OM growth 5Y1.77%
PM growth 3Y-0.79%
PM growth 5Y2.38%
GM growth 3Y1.56%
GM growth 5Y1.64%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), MCD is creating value.
- The number of shares outstanding for MCD has been reduced compared to 1 year ago.
- The number of shares outstanding for MCD has been reduced compared to 5 years ago.
- The debt/assets ratio for MCD has remained at the same level compared to a year ago.
2.2 Solvency
- MCD has an Altman-Z score of 4.84. This indicates that MCD is financially healthy and has little risk of bankruptcy at the moment.
- The Altman-Z score of MCD (4.84) is better than 88.64% of its industry peers.
- MCD has a debt to FCF ratio of 5.60. This is a neutral value as MCD would need 5.60 years to pay back of all of its debts.
- MCD's Debt to FCF ratio of 5.60 is fine compared to the rest of the industry. MCD outperforms 74.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.6 | ||
| Altman-Z | 4.84 |
ROIC/WACC2.22
WACC8%
2.3 Liquidity
- MCD has a Current Ratio of 1.00. This is a normal value and indicates that MCD is financially healthy and should not expect problems in meeting its short term obligations.
- MCD has a Current ratio of 1.00. This is comparable to the rest of the industry: MCD outperforms 53.03% of its industry peers.
- MCD has a Quick Ratio of 1.00. This is a bad value and indicates that MCD is not financially healthy enough and could expect problems in meeting its short term obligations.
- MCD has a Quick ratio (0.99) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1 | ||
| Quick Ratio | 0.99 |
3. Growth
3.1 Past
- MCD shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.51%.
- The Earnings Per Share has been growing by 8.20% on average over the past years. This is quite good.
- Looking at the last year, MCD shows a small growth in Revenue. The Revenue has grown by 1.26% in the last year.
- MCD shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.94% yearly.
EPS 1Y (TTM)0.51%
EPS 3Y8.12%
EPS 5Y8.2%
EPS Q2Q%-0.31%
Revenue 1Y (TTM)1.26%
Revenue growth 3Y3.73%
Revenue growth 5Y3.94%
Sales Q2Q%2.98%
3.2 Future
- The Earnings Per Share is expected to grow by 9.60% on average over the next years. This is quite good.
- MCD is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.51% yearly.
EPS Next Y4.49%
EPS Next 2Y6.77%
EPS Next 3Y7.36%
EPS Next 5Y9.6%
Revenue Next Year2.58%
Revenue Next 2Y4.13%
Revenue Next 3Y4.46%
Revenue Next 5Y5.51%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 26.70, the valuation of MCD can be described as expensive.
- Compared to the rest of the industry, the Price/Earnings ratio of MCD is on the same level as its industry peers.
- MCD's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.32.
- MCD is valuated rather expensively with a Price/Forward Earnings ratio of 23.78.
- The rest of the industry has a similar Price/Forward Earnings ratio as MCD.
- MCD's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.57.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.7 | ||
| Fwd PE | 23.78 |
4.2 Price Multiples
- 65.15% of the companies in the same industry are cheaper than MCD, based on the Enterprise Value to EBITDA ratio.
- MCD's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.71 | ||
| EV/EBITDA | 18.42 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- MCD has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)5.95
PEG (5Y)3.26
EPS Next 2Y6.77%
EPS Next 3Y7.36%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.36%, MCD has a reasonable but not impressive dividend return.
- MCD's Dividend Yield is rather good when compared to the industry average which is at 1.25. MCD pays more dividend than 82.58% of the companies in the same industry.
- MCD's Dividend Yield is a higher than the S&P500 average which is at 1.83.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.36% |
5.2 History
- On average, the dividend of MCD grows each year by 7.43%, which is quite nice.
- MCD has paid a dividend for at least 10 years, which is a reliable track record.
- MCD has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)7.43%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
- MCD pays out 60.13% of its income as dividend. This is not a sustainable payout ratio.
- The dividend of MCD is growing, but earnings are growing more, so the dividend growth is sustainable.
DP60.13%
EPS Next 2Y6.77%
EPS Next 3Y7.36%
MCDONALD'S CORP / MCD FAQ
Can you provide the ChartMill fundamental rating for MCDONALD'S CORP?
ChartMill assigns a fundamental rating of 6 / 10 to MCD.
What is the valuation status for MCD stock?
ChartMill assigns a valuation rating of 2 / 10 to MCDONALD'S CORP (MCD). This can be considered as Overvalued.
How profitable is MCDONALD'S CORP (MCD) stock?
MCDONALD'S CORP (MCD) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for MCD stock?
The Price/Earnings (PE) ratio for MCDONALD'S CORP (MCD) is 26.7 and the Price/Book (PB) ratio is -104.68.
Can you provide the dividend sustainability for MCD stock?
The dividend rating of MCDONALD'S CORP (MCD) is 7 / 10 and the dividend payout ratio is 60.13%.