MCDONALD'S CORP (MCD) Stock Fundamental Analysis
USA - NYSE:MCD - US5801351017 - Common Stock
299.66 USD
+1.25 (+0.42%)
300.35 USD
+0.69 (+0.23%)
Taking everything into account, MCD scores 6 out of 10 in our fundamental rating. MCD was compared to 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. While showing a medium growth rate, MCD is valued expensive at the moment. MCD also has an excellent dividend rating. This makes MCD very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
MCD had positive earnings in the past year.
In the past year MCD had a positive cash flow from operations.
In the past 5 years MCD has always been profitable.
Each year in the past 5 years MCD had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 13.88%, MCD belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
MCD has a Return On Invested Capital of 17.77%. This is amongst the best in the industry. MCD outperforms 88.64% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MCD is significantly above the industry average of 10.78%.
| 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
The Profit Margin of MCD (32.04%) is better than 99.24% of its industry peers.
MCD's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 46.12%, MCD belongs to the best 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.
With a decent Gross Margin value of 57.43%, MCD is doing good in the industry, outperforming 71.21% of the companies in the same industry.
MCD's Gross Margin has improved in the last couple of years.
| 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.
Compared to 1 year ago, MCD has less shares outstanding
Compared to 5 years ago, MCD has less shares outstanding
The debt/assets ratio for MCD has remained at the same level compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.73 indicates that MCD is not in any danger for bankruptcy at the moment.
MCD has a Altman-Z score of 4.73. This is amongst the best in the industry. MCD outperforms 87.12% 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 has a Debt to FCF ratio of 5.60. This is in the better half of the industry: MCD outperforms 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.6 | ||
| Altman-Z | 4.73 |
ROIC/WACC2.27
WACC7.83%
2.3 Liquidity
A Current Ratio of 1.00 indicates that MCD should not have too much problems paying its short term obligations.
MCD's Current ratio of 1.00 is in line compared to the rest of the industry. MCD outperforms 53.79% of its industry peers.
A Quick Ratio of 0.99 indicates that MCD may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.99, MCD is in line with its industry, outperforming 56.82% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1 | ||
| Quick Ratio | 0.99 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.51% over the past year.
Measured over the past years, MCD shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.20% on average per year.
Looking at the last year, MCD shows a small growth in Revenue. The Revenue has grown by 1.26% in the last year.
Measured over the past years, MCD shows a small growth in Revenue. The Revenue has been growing by 3.94% on average per year.
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
MCD is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.23% yearly.
Based on estimates for the next years, MCD will show a small growth in Revenue. The Revenue will grow by 5.06% on average per year.
EPS Next Y5.63%
EPS Next 2Y6.96%
EPS Next 3Y7.48%
EPS Next 5Y9.23%
Revenue Next Year2.81%
Revenue Next 2Y4.22%
Revenue Next 3Y4.63%
Revenue Next 5Y5.06%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
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
With a Price/Earnings ratio of 25.16, MCD can be considered very expensive at the moment.
MCD's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of MCD to the average of the S&P500 Index (25.83), we can say MCD is valued inline with the index average.
A Price/Forward Earnings ratio of 22.33 indicates a rather expensive valuation of MCD.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MCD is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 32.68, MCD is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.16 | ||
| Fwd PE | 22.33 |
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 | 29 | ||
| EV/EBITDA | 17.62 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of MCD may justify a higher PE ratio.
PEG (NY)4.47
PEG (5Y)3.07
EPS Next 2Y6.96%
EPS Next 3Y7.48%
5. Dividend
5.1 Amount
MCD has a Yearly Dividend Yield of 2.49%.
Compared to an average industry Dividend Yield of 4.35, MCD pays a better dividend. On top of this MCD pays more dividend than 80.30% of the companies listed in the same industry.
MCD's Dividend Yield is comparable with the S&P500 average which is at 2.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.49% |
5.2 History
The dividend of MCD is nicely growing with an annual growth rate of 7.43%!
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
60.13% of the earnings are spent on dividend by MCD. This is not a sustainable payout ratio.
MCD's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP60.13%
EPS Next 2Y6.96%
EPS Next 3Y7.48%
299.66
+1.25 (+0.42%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners74.98%
Inst Owner Change-0.64%
Ins Owners0.2%
Ins Owner Change-6.49%
Market Cap213.84B
Revenue(TTM)26.27B
Net Income(TTM)8.41B
Analysts72.27
Price Target341.44 (13.94%)
Short Float %1.03%
Short Ratio2.48
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.49% |
Yearly Dividend6.77
Dividend Growth(5Y)7.43%
DP60.13%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.88%
Min EPS beat(2)-4.16%
Max EPS beat(2)0.41%
EPS beat(4)1
Avg EPS beat(4)-1.35%
Min EPS beat(4)-4.16%
Max EPS beat(4)0.41%
EPS beat(8)2
Avg EPS beat(8)-0.99%
EPS beat(12)6
Avg EPS beat(12)2.17%
EPS beat(16)9
Avg EPS beat(16)1.87%
Revenue beat(2)1
Avg Revenue beat(2)-0.08%
Min Revenue beat(2)-1.23%
Max Revenue beat(2)1.06%
Revenue beat(4)1
Avg Revenue beat(4)-1.3%
Min Revenue beat(4)-3.22%
Max Revenue beat(4)1.06%
Revenue beat(8)1
Avg Revenue beat(8)-1.33%
Revenue beat(12)5
Avg Revenue beat(12)0.04%
Revenue beat(16)7
Avg Revenue beat(16)-0.04%
PT rev (1m)-1.03%
PT rev (3m)0.34%
EPS NQ rev (1m)-2.23%
EPS NQ rev (3m)-1.7%
EPS NY rev (1m)-0.51%
EPS NY rev (3m)0.22%
Revenue NQ rev (1m)-0.33%
Revenue NQ rev (3m)1.13%
Revenue NY rev (1m)-0.11%
Revenue NY rev (3m)1.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.16 | ||
| Fwd PE | 22.33 | ||
| P/S | 8.14 | ||
| P/FCF | 29 | ||
| P/OCF | 20.39 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.62 |
EPS(TTM)11.91
EY3.97%
EPS(NY)13.42
Fwd EY4.48%
FCF(TTM)10.33
FCFY3.45%
OCF(TTM)14.7
OCFY4.9%
SpS36.81
BVpS-3.03
TBVpS-7.66
PEG (NY)4.47
PEG (5Y)3.07
Graham NumberN/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.88% | ||
| ROE | N/A | ||
| ROCE | 22.22% | ||
| ROIC | 17.77% | ||
| ROICexc | 18.59% | ||
| ROICexgc | 19.85% | ||
| OM | 46.12% | ||
| PM (TTM) | 32.04% | ||
| GM | 57.43% | ||
| FCFM | 28.08% |
ROA(3y)14.08%
ROA(5y)13.05%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)18.38%
ROIC(5y)16.68%
ROICexc(3y)19.5%
ROICexc(5y)17.88%
ROICexgc(3y)21.29%
ROICexgc(5y)19.49%
ROCE(3y)23.04%
ROCE(5y)20.89%
ROICexgc growth 3Y2.6%
ROICexgc growth 5Y2.93%
ROICexc growth 3Y2.55%
ROICexc growth 5Y2.53%
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%
F-Score7
Asset Turnover0.43
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.6 | ||
| Debt/EBITDA | 2.76 | ||
| Cap/Depr | 143.06% | ||
| Cap/Sales | 11.85% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 73.39% | ||
| Profit Quality | 87.63% | ||
| Current Ratio | 1 | ||
| Quick Ratio | 0.99 | ||
| Altman-Z | 4.73 |
F-Score7
WACC7.83%
ROIC/WACC2.27
Cap/Depr(3y)117.68%
Cap/Depr(5y)111.18%
Cap/Sales(3y)9.38%
Cap/Sales(5y)9.09%
Profit Quality(3y)85.21%
Profit Quality(5y)89.5%
High Growth Momentum
Growth
EPS 1Y (TTM)0.51%
EPS 3Y8.12%
EPS 5Y8.2%
EPS Q2Q%-0.31%
EPS Next Y5.63%
EPS Next 2Y6.96%
EPS Next 3Y7.48%
EPS Next 5Y9.23%
Revenue 1Y (TTM)1.26%
Revenue growth 3Y3.73%
Revenue growth 5Y3.94%
Sales Q2Q%2.98%
Revenue Next Year2.81%
Revenue Next 2Y4.22%
Revenue Next 3Y4.63%
Revenue Next 5Y5.06%
EBIT growth 1Y2.6%
EBIT growth 3Y6.28%
EBIT growth 5Y5.78%
EBIT Next Year22.23%
EBIT Next 3Y11.93%
EBIT Next 5Y9.88%
FCF growth 1Y2.48%
FCF growth 3Y-2.05%
FCF growth 5Y3.1%
OCF growth 1Y12.47%
OCF growth 3Y1.11%
OCF growth 5Y3.07%
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 of MCDONALD'S CORP (MCD) stock?
ChartMill assigns a valuation rating of 3 / 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.
What are the PE and PB ratios of MCDONALD'S CORP (MCD) stock?
The Price/Earnings (PE) ratio for MCDONALD'S CORP (MCD) is 25.16 and the Price/Book (PB) ratio is -98.86.
How financially healthy is MCDONALD'S CORP?
The financial health rating of MCDONALD'S CORP (MCD) is 5 / 10.