MCDONALD'S CORP (MCD) Stock Fundamental Analysis
USA - NYSE:MCD - US5801351017 - Common Stock
308.08 USD
+0.31 (+0.1%)
We assign a fundamental rating of 6 out of 10 to MCD. MCD was compared to 134 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 valied quite expensively at the moment, while it does show a decent growth rate. Finally MCD also has an excellent dividend rating. This makes MCD very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
In the past year MCD was profitable.
In the past year MCD had a positive cash flow from operations.
In the past 5 years MCD has always been profitable.
In the past 5 years MCD always reported a positive cash flow from operatings.
1.2 Ratios
MCD's Return On Assets of 14.09% is amongst the best of the industry. MCD outperforms 91.04% of its industry peers.
MCD has a better Return On Invested Capital (17.40%) than 87.31% of its industry peers.
MCD had an Average Return On Invested Capital over the past 3 years of 18.38%. This is significantly above the industry average of 10.67%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.09% | ||
| ROE | N/A | ||
| ROIC | 17.4% |
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 (32.20%) is better than 99.25% of its industry peers.
MCD's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 46.13%, MCD belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
In the last couple of years the Operating Margin of MCD has grown nicely.
Looking at the Gross Margin, with a value of 57.00%, MCD is in the better half of the industry, outperforming 69.40% of the companies in the same industry.
In the last couple of years the Gross Margin of MCD has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 46.13% | ||
| PM (TTM) | 32.2% | ||
| GM | 57% |
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
Compared to 1 year ago, MCD has about the same debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.85 indicates that MCD is not in any danger for bankruptcy at the moment.
The Altman-Z score of MCD (4.85) is better than 85.07% of its industry peers.
MCD has a debt to FCF ratio of 6.00. This is a slightly negative value and a sign of low solvency as MCD would need 6.00 years to pay back of all of its debts.
MCD's Debt to FCF ratio of 6.00 is fine compared to the rest of the industry. MCD outperforms 72.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6 | ||
| Altman-Z | 4.85 |
ROIC/WACC2.24
WACC7.78%
2.3 Liquidity
A Current Ratio of 1.30 indicates that MCD should not have too much problems paying its short term obligations.
With a decent Current ratio value of 1.30, MCD is doing good in the industry, outperforming 64.18% of the companies in the same industry.
A Quick Ratio of 1.29 indicates that MCD should not have too much problems paying its short term obligations.
The Quick ratio of MCD (1.29) is better than 67.16% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 1.29 |
3. Growth
3.1 Past
MCD shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 0.93%.
MCD shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.20% yearly.
Looking at the last year, MCD shows a small growth in Revenue. The Revenue has grown by 1.17% 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)0.93%
EPS 3Y8.12%
EPS 5Y8.2%
EPS Q2Q%7.41%
Revenue 1Y (TTM)1.17%
Revenue growth 3Y3.73%
Revenue growth 5Y3.94%
Sales Q2Q%5.44%
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 Y6.33%
EPS Next 2Y7.41%
EPS Next 3Y7.89%
EPS Next 5Y9.23%
Revenue Next Year2.95%
Revenue Next 2Y4.22%
Revenue Next 3Y4.64%
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
MCD is valuated quite expensively with a Price/Earnings ratio of 25.85.
The rest of the industry has a similar Price/Earnings ratio as MCD.
MCD's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.69.
A Price/Forward Earnings ratio of 22.76 indicates a rather expensive valuation of MCD.
MCD's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 23.18. MCD is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.85 | ||
| Fwd PE | 22.76 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MCD is valued a bit more expensive than 64.18% of the companies in the same industry.
MCD's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.87 | ||
| EV/EBITDA | 18.29 |
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)4.08
PEG (5Y)3.15
EPS Next 2Y7.41%
EPS Next 3Y7.89%
5. Dividend
5.1 Amount
MCD has a Yearly Dividend Yield of 2.32%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.84, MCD pays a better dividend. On top of this MCD pays more dividend than 81.34% of the companies listed in the same industry.
MCD's Dividend Yield is comparable with the S&P500 average which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
5.2 History
On average, the dividend of MCD grows each year by 7.43%, which is quite nice.
MCD has been paying a dividend for at least 10 years, so it has 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
59.52% of the earnings are spent on dividend by MCD. This is a bit on the high side, but may be sustainable.
The dividend of MCD is growing, but earnings are growing more, so the dividend growth is sustainable.
DP59.52%
EPS Next 2Y7.41%
EPS Next 3Y7.89%
NYSE:MCD (10/21/2025, 11:04:03 AM)
308.08
+0.31 (+0.1%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners74.98%
Inst Owner Change-0.08%
Ins Owners0.2%
Ins Owner Change-6.64%
Market Cap219.85B
Analysts72.38
Price Target345.64 (12.19%)
Short Float %1.16%
Short Ratio2.52
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
Yearly Dividend6.77
Dividend Growth(5Y)7.43%
DP59.52%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.06%
Min EPS beat(2)-0.53%
Max EPS beat(2)0.41%
EPS beat(4)1
Avg EPS beat(4)-0.35%
Min EPS beat(4)-1.13%
Max EPS beat(4)0.41%
EPS beat(8)3
Avg EPS beat(8)0.17%
EPS beat(12)7
Avg EPS beat(12)2.76%
EPS beat(16)10
Avg EPS beat(16)2.82%
Revenue beat(2)1
Avg Revenue beat(2)-1.08%
Min Revenue beat(2)-3.22%
Max Revenue beat(2)1.06%
Revenue beat(4)1
Avg Revenue beat(4)-1.05%
Min Revenue beat(4)-3.22%
Max Revenue beat(4)1.06%
Revenue beat(8)2
Avg Revenue beat(8)-1.08%
Revenue beat(12)6
Avg Revenue beat(12)0.33%
Revenue beat(16)8
Avg Revenue beat(16)0.15%
PT rev (1m)0.19%
PT rev (3m)1.57%
EPS NQ rev (1m)-1.25%
EPS NQ rev (3m)-0.4%
EPS NY rev (1m)-0.14%
EPS NY rev (3m)0.73%
Revenue NQ rev (1m)-0.14%
Revenue NQ rev (3m)1.79%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)1.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.85 | ||
| Fwd PE | 22.76 | ||
| P/S | 8.44 | ||
| P/FCF | 31.87 | ||
| P/OCF | 22.45 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.29 |
EPS(TTM)11.92
EY3.87%
EPS(NY)13.53
Fwd EY4.39%
FCF(TTM)9.67
FCFY3.14%
OCF(TTM)13.72
OCFY4.45%
SpS36.52
BVpS-3.87
TBVpS-8.5
PEG (NY)4.08
PEG (5Y)3.15
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.09% | ||
| ROE | N/A | ||
| ROCE | 21.76% | ||
| ROIC | 17.4% | ||
| ROICexc | 18.01% | ||
| ROICexgc | 19.2% | ||
| OM | 46.13% | ||
| PM (TTM) | 32.2% | ||
| GM | 57% | ||
| FCFM | 26.47% |
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)19.5%
ROCE(3y)23.04%
ROCE(5y)20.89%
ROICexcg growth 3Y2.6%
ROICexcg 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 Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6 | ||
| Debt/EBITDA | 2.88 | ||
| Cap/Depr | 134.76% | ||
| Cap/Sales | 11.11% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 69.11% | ||
| Profit Quality | 82.2% | ||
| Current Ratio | 1.3 | ||
| Quick Ratio | 1.29 | ||
| Altman-Z | 4.85 |
F-Score7
WACC7.78%
ROIC/WACC2.24
Cap/Depr(3y)117.68%
Cap/Depr(5y)111.18%
Cap/Sales(3y)9.38%
Cap/Sales(5y)9.09%
Profit Quality(3y)85.22%
Profit Quality(5y)89.5%
High Growth Momentum
Growth
EPS 1Y (TTM)0.93%
EPS 3Y8.12%
EPS 5Y8.2%
EPS Q2Q%7.41%
EPS Next Y6.33%
EPS Next 2Y7.41%
EPS Next 3Y7.89%
EPS Next 5Y9.23%
Revenue 1Y (TTM)1.17%
Revenue growth 3Y3.73%
Revenue growth 5Y3.94%
Sales Q2Q%5.44%
Revenue Next Year2.95%
Revenue Next 2Y4.22%
Revenue Next 3Y4.64%
Revenue Next 5Y5.06%
EBIT growth 1Y2.2%
EBIT growth 3Y6.28%
EBIT growth 5Y5.78%
EBIT Next Year22.23%
EBIT Next 3Y11.93%
EBIT Next 5Y10.03%
FCF growth 1Y3.89%
FCF growth 3Y-2.05%
FCF growth 5Y3.1%
OCF growth 1Y12.2%
OCF growth 3Y1.11%
OCF growth 5Y3.07%