MCDONALD'S CORP (MCD) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MCD - US5801351017 - Common Stock
309.71 USD
-0.82 (-0.26%)
309.71 USD
0 (0%)
Taking everything into account, MCD scores 6 out of 10 in our fundamental rating. MCD was compared to 131 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.
MCD had a positive operating cash flow in the past year.
Each year in the past 5 years MCD has been profitable.
Each year in the past 5 years MCD had a positive operating cash flow.
1.2 Ratios
MCD's Return On Assets of 13.88% is amongst the best of the industry. MCD outperforms 90.84% 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 89.31% 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 10.43%.
| 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 97.71% of its industry peers.
MCD's Profit Margin has improved in the last couple of years.
MCD has a Operating Margin of 46.12%. This is amongst the best in the industry. MCD outperforms 100.00% of its industry peers.
In the last couple of years the Operating Margin of MCD has grown nicely.
MCD has a Gross Margin of 57.43%. This is in the better half of the industry: MCD outperforms 71.76% of its industry peers.
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.
MCD has less shares outstanding than it did 1 year ago.
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 4.81 indicates that MCD is not in any danger for bankruptcy at the moment.
MCD has a better Altman-Z score (4.81) than 87.02% 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.
Looking at the Debt to FCF ratio, with a value of 5.60, MCD is in the better half of the industry, outperforming 74.05% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.6 | ||
| Altman-Z | 4.81 |
ROIC/WACC2.21
WACC8.04%
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 53.44% 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.
Looking at the Quick ratio, with a value of 0.99, MCD is in line with its industry, outperforming 56.49% of the companies in the same 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%.
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 10.93% yearly.
The Revenue is expected to grow by 5.81% on average over the next years.
EPS Next Y4.44%
EPS Next 2Y6.77%
EPS Next 3Y7.49%
EPS Next 5Y10.93%
Revenue Next Year2.58%
Revenue Next 2Y4.08%
Revenue Next 3Y4.44%
Revenue Next 5Y5.81%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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 26.00, MCD can be considered very expensive at the moment.
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 26.76.
The Price/Forward Earnings ratio is 23.16, which indicates a rather expensive current 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 23.96, MCD is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26 | ||
| Fwd PE | 23.16 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MCD is valued a bit more expensive than 64.89% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, MCD is valued a bit cheaper than the industry average as 61.07% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.91 | ||
| EV/EBITDA | 18.15 |
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)5.86
PEG (5Y)3.17
EPS Next 2Y6.77%
EPS Next 3Y7.49%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.41%, 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 3.84. MCD pays more dividend than 83.21% of the companies in the same industry.
MCD's Dividend Yield is comparable with the S&P500 average which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.41% |
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 their dividend for at least 10 years, which is a reliable track record.
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 3Y7.49%
309.71
-0.82 (-0.26%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners74.95%
Inst Owner Change-1.12%
Ins Owners0.2%
Ins Owner Change-1.98%
Market Cap220.56B
Revenue(TTM)26.27B
Net Income(TTM)8.41B
Analysts71.63
Price Target342.07 (10.45%)
Short Float %1.09%
Short Ratio2.6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.41% |
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)0.18%
PT rev (3m)-0.81%
EPS NQ rev (1m)-0.37%
EPS NQ rev (3m)-3.14%
EPS NY rev (1m)-1.13%
EPS NY rev (3m)-1.91%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)-1.11%
Revenue NY rev (1m)-0.23%
Revenue NY rev (3m)-0.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26 | ||
| Fwd PE | 23.16 | ||
| P/S | 8.4 | ||
| P/FCF | 29.91 | ||
| P/OCF | 21.03 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.15 |
EPS(TTM)11.91
EY3.85%
EPS(NY)13.37
Fwd EY4.32%
FCF(TTM)10.35
FCFY3.34%
OCF(TTM)14.73
OCFY4.75%
SpS36.88
BVpS-3.04
TBVpS-7.68
PEG (NY)5.86
PEG (5Y)3.17
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 | 4.81 |
F-Score7
WACC8.04%
ROIC/WACC2.21
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 Y4.44%
EPS Next 2Y6.77%
EPS Next 3Y7.49%
EPS Next 5Y10.93%
Revenue 1Y (TTM)1.26%
Revenue growth 3Y3.73%
Revenue growth 5Y3.94%
Sales Q2Q%2.98%
Revenue Next Year2.58%
Revenue Next 2Y4.08%
Revenue Next 3Y4.44%
Revenue Next 5Y5.81%
EBIT growth 1Y2.6%
EBIT growth 3Y6.28%
EBIT growth 5Y5.78%
EBIT Next Year21.72%
EBIT Next 3Y11.49%
EBIT Next 5Y11.55%
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 26 and the Price/Book (PB) ratio is -101.97.
How financially healthy is MCDONALD'S CORP?
The financial health rating of MCDONALD'S CORP (MCD) is 5 / 10.