MCDONALD'S CORP (1MCD.MI) Stock Fundamental Analysis
BIT:1MCD - Borsa Italiana Milan - US5801351017 - Common Stock - Currency: EUR
Overall 1MCD gets a fundamental rating of 5 out of 10. We evaluated 1MCD against 53 industry peers in the Hotels, Restaurants & Leisure industry. While 1MCD has a great profitability rating, there are quite some concerns on its financial health. 1MCD is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
1MCD had positive earnings in the past year.
1MCD had a positive operating cash flow in the past year.
Each year in the past 5 years 1MCD has been profitable.
1MCD had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 14.68%, 1MCD belongs to the best of the industry, outperforming 93.33% of the companies in the same industry.
1MCD has a better Return On Invested Capital (18.87%) than 93.33% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 1MCD is significantly above the industry average of 11.62%.
The last Return On Invested Capital (18.87%) for 1MCD is above the 3 year average (17.45%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.68% | ||
| ROE | N/A | ||
| ROIC | 18.87% |
ROA(3y)13.78%
ROA(5y)12.6%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)17.45%
ROIC(5y)16.19%
1.3 Margins
1MCD has a Profit Margin of 31.79%. This is amongst the best in the industry. 1MCD outperforms 97.78% of its industry peers.
1MCD's Profit Margin has improved in the last couple of years.
The Operating Margin of 1MCD (45.52%) is better than 100.00% of its industry peers.
1MCD's Operating Margin has improved in the last couple of years.
1MCD's Gross Margin of 56.62% is in line compared to the rest of the industry. 1MCD outperforms 44.44% of its industry peers.
In the last couple of years the Gross Margin of 1MCD has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 45.52% | ||
| PM (TTM) | 31.79% | ||
| GM | 56.62% |
OM growth 3Y7.08%
OM growth 5Y2.56%
PM growth 3Y10.49%
PM growth 5Y3.58%
GM growth 3Y4.01%
GM growth 5Y2.31%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), 1MCD is creating value.
Compared to 1 year ago, 1MCD has less shares outstanding
1MCD has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, 1MCD has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.76 indicates that 1MCD is not in any danger for bankruptcy at the moment.
1MCD has a better Altman-Z score (4.76) than 91.11% of its industry peers.
The Debt to FCF ratio of 1MCD is 6.02, which is on the high side as it means it would take 1MCD, 6.02 years of fcf income to pay off all of its debts.
1MCD has a Debt to FCF ratio (6.02) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6.02 | ||
| Altman-Z | 4.76 |
ROIC/WACC2.31
WACC8.16%
2.3 Liquidity
1MCD has a Current Ratio of 0.78. This is a bad value and indicates that 1MCD is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.78, 1MCD is not doing good in the industry: 62.22% of the companies in the same industry are doing better.
A Quick Ratio of 0.77 indicates that 1MCD may have some problems paying its short term obligations.
1MCD's Quick ratio of 0.77 is on the low side compared to the rest of the industry. 1MCD is outperformed by 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.77 |
3. Growth
3.1 Past
1MCD shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 2.33%.
The Earnings Per Share has been growing by 8.75% on average over the past years. This is quite good.
The Revenue has been growing slightly by 3.69% in the past year.
1MCD shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.70% yearly.
EPS 1Y (TTM)2.33%
EPS 3Y25.43%
EPS 5Y8.75%
EPS Q2Q%1.25%
Revenue 1Y (TTM)3.69%
Revenue growth 3Y9.9%
Revenue growth 5Y3.7%
Sales Q2Q%2.7%
3.2 Future
The Earnings Per Share is expected to grow by 7.22% on average over the next years.
Based on estimates for the next years, 1MCD will show a small growth in Revenue. The Revenue will grow by 4.86% on average per year.
EPS Next Y-0.14%
EPS Next 2Y3.23%
EPS Next 3Y4.91%
EPS Next 5Y7.22%
Revenue Next Year2.09%
Revenue Next 2Y2.8%
Revenue Next 3Y3.6%
Revenue Next 5Y4.86%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 24.30, 1MCD is valued on the expensive side.
1MCD's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 28.47, 1MCD is valued at the same level.
Based on the Price/Forward Earnings ratio of 22.64, the valuation of 1MCD can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of 1MCD is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 92.74. 1MCD is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.3 | ||
| Fwd PE | 22.64 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of 1MCD is on the same level as its industry peers.
1MCD's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. 1MCD is more expensive than 64.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.37 | ||
| EV/EBITDA | 17.68 |
4.3 Compensation for Growth
The excellent profitability rating of 1MCD may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.78
EPS Next 2Y3.23%
EPS Next 3Y4.91%
5. Dividend
5.1 Amount
1MCD has a Yearly Dividend Yield of 2.49%.
1MCD's Dividend Yield is rather good when compared to the industry average which is at 2.78. 1MCD pays more dividend than 82.22% of the companies in the same industry.
1MCD's Dividend Yield is comparable with the S&P500 average which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.49% |
5.2 History
On average, the dividend of 1MCD grows each year by 8.37%, which is quite nice.
Dividend Growth(5Y)8.37%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
1MCD pays out 58.34% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of 1MCD is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP58.34%
EPS Next 2Y3.23%
EPS Next 3Y4.91%
MCDONALD'S CORP
BIT:1MCD (2/4/2025, 7:00:00 PM)
278.7
-1.45 (-0.52%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners72.06%
Inst Owner ChangeN/A
Ins Owners0.16%
Ins Owner ChangeN/A
Market Cap199.72B
Analysts76.36
Price Target319.11 (14.5%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.49% |
Yearly Dividend6.24
Dividend Growth(5Y)8.37%
DP58.34%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-2.19%
Min EPS beat(2)-4.24%
Max EPS beat(2)-0.14%
EPS beat(4)1
Avg EPS beat(4)-0.63%
Min EPS beat(4)-4.24%
Max EPS beat(4)3.45%
EPS beat(8)5
Avg EPS beat(8)3.93%
EPS beat(12)8
Avg EPS beat(12)2.94%
EPS beat(16)11
Avg EPS beat(16)3.57%
Revenue beat(2)0
Avg Revenue beat(2)-1.49%
Min Revenue beat(2)-2.76%
Max Revenue beat(2)-0.22%
Revenue beat(4)0
Avg Revenue beat(4)-1.35%
Min Revenue beat(4)-2.76%
Max Revenue beat(4)-0.22%
Revenue beat(8)4
Avg Revenue beat(8)0.72%
Revenue beat(12)6
Avg Revenue beat(12)0.39%
Revenue beat(16)9
Avg Revenue beat(16)0.58%
PT rev (1m)2.62%
PT rev (3m)7.94%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-5.11%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.14%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.97%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)-0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.3 | ||
| Fwd PE | 22.64 | ||
| P/S | 7.96 | ||
| P/FCF | 31.37 | ||
| P/OCF | 22.18 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.68 |
EPS(TTM)11.47
EY4.12%
EPS(NY)12.31
Fwd EY4.42%
FCF(TTM)8.88
FCFY3.19%
OCF(TTM)12.56
OCFY4.51%
SpS35.02
BVpS-6.99
TBVpS-11.34
PEG (NY)N/A
PEG (5Y)2.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.68% | ||
| ROE | N/A | ||
| ROCE | 23.68% | ||
| ROIC | 18.87% | ||
| ROICexc | 19.35% | ||
| ROICexgc | 20.72% | ||
| OM | 45.52% | ||
| PM (TTM) | 31.79% | ||
| GM | 56.62% | ||
| FCFM | 25.37% |
ROA(3y)13.78%
ROA(5y)12.6%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)17.45%
ROIC(5y)16.19%
ROICexc(3y)18.98%
ROICexc(5y)17.38%
ROICexgc(3y)20.72%
ROICexgc(5y)18.88%
ROCE(3y)21.94%
ROCE(5y)20.35%
ROICexcg growth 3Y16.09%
ROICexcg growth 5Y-2.65%
ROICexc growth 3Y15.86%
ROICexc growth 5Y-2.75%
OM growth 3Y7.08%
OM growth 5Y2.56%
PM growth 3Y10.49%
PM growth 5Y3.58%
GM growth 3Y4.01%
GM growth 5Y2.31%
F-Score5
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6.02 | ||
| Debt/EBITDA | 2.82 | ||
| Cap/Depr | 133.5% | ||
| Cap/Sales | 10.51% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 67.19% | ||
| Profit Quality | 79.8% | ||
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.77 | ||
| Altman-Z | 4.76 |
F-Score5
WACC8.16%
ROIC/WACC2.31
Cap/Depr(3y)109.97%
Cap/Depr(5y)114.31%
Cap/Sales(3y)8.74%
Cap/Sales(5y)9.19%
Profit Quality(3y)89.54%
Profit Quality(5y)92.29%
High Growth Momentum
Growth
EPS 1Y (TTM)2.33%
EPS 3Y25.43%
EPS 5Y8.75%
EPS Q2Q%1.25%
EPS Next Y-0.14%
EPS Next 2Y3.23%
EPS Next 3Y4.91%
EPS Next 5Y7.22%
Revenue 1Y (TTM)3.69%
Revenue growth 3Y9.9%
Revenue growth 5Y3.7%
Sales Q2Q%2.7%
Revenue Next Year2.09%
Revenue Next 2Y2.8%
Revenue Next 3Y3.6%
Revenue Next 5Y4.86%
EBIT growth 1Y2.58%
EBIT growth 3Y17.68%
EBIT growth 5Y6.35%
EBIT Next Year18.39%
EBIT Next 3Y9.82%
EBIT Next 5Y8.74%
FCF growth 1Y13.55%
FCF growth 3Y16.19%
FCF growth 5Y11.42%
OCF growth 1Y18.51%
OCF growth 3Y15.33%
OCF growth 5Y6.65%