MCDONALD'S CORP (MCD) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MCD - US5801351017 - Common Stock
310.79 USD
+1 (+0.32%)
310.8 USD
0.01 (0%)
MCD gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 131 industry peers in the Hotels, Restaurants & Leisure industry. While MCD has a great profitability rating, 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. With these ratings, MCD could be worth investigating further 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
With an excellent Return On Assets value of 13.88%, MCD belongs to the best of the industry, outperforming 90.84% of the companies in the same industry.
With an excellent Return On Invested Capital value of 17.77%, MCD belongs to the best 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
MCD's Profit Margin of 32.04% is amongst the best of the industry. MCD outperforms 97.71% of its industry peers.
MCD's Profit Margin has improved in the last couple of years.
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.
Looking at the Gross Margin, with a value of 57.43%, MCD is in the better half of the industry, outperforming 71.76% 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 | 46.12% | ||
| 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
MCD has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, MCD has less shares outstanding
Compared to 5 years ago, MCD has less shares outstanding
MCD has about the same debt/assets ratio as last year.
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 Altman-Z score of 4.81. This is amongst the best in the industry. MCD outperforms 87.02% of its industry peers.
The Debt to FCF ratio of MCD is 5.60, which is a neutral value as it means it would take MCD, 5.60 years of fcf income to pay off all of its debts.
MCD's Debt to FCF ratio of 5.60 is fine compared to the rest of the industry. MCD outperforms 74.05% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.6 | ||
| Altman-Z | 4.81 |
ROIC/WACC2.2
WACC8.06%
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.
With a Current ratio value of 1.00, MCD perfoms like the industry average, outperforming 53.44% of the companies in the same industry.
A Quick Ratio of 0.99 indicates that MCD may have some problems paying its short term obligations.
The Quick ratio of MCD (0.99) 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.
The Revenue has been growing slightly by 1.26% in the past 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
Based on estimates for the next years, MCD will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.93% on average per year.
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
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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 26.09.
Compared to the rest of the industry, the Price/Earnings ratio of MCD is on the same level as its industry peers.
MCD is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.29, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 23.24, the valuation of MCD can be described as rather expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as MCD.
The average S&P500 Price/Forward Earnings ratio is at 23.51. MCD is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.09 | ||
| Fwd PE | 23.24 |
4.2 Price Multiples
65.65% of the companies in the same industry are cheaper than MCD, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of MCD is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.01 | ||
| EV/EBITDA | 18.21 |
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)5.88
PEG (5Y)3.18
EPS Next 2Y6.77%
EPS Next 3Y7.49%
5. Dividend
5.1 Amount
MCD has a Yearly Dividend Yield of 2.41%. 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 83.21% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.31, MCD has a dividend comparable with the average S&P500 company.
| 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 paid a dividend for at least 10 years, which is 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%
310.79
+1 (+0.32%)
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 Cap221.33B
Revenue(TTM)26.27B
Net Income(TTM)8.41B
Analysts71.63
Price Target342.07 (10.06%)
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 | 26.09 | ||
| Fwd PE | 23.24 | ||
| P/S | 8.43 | ||
| P/FCF | 30.01 | ||
| P/OCF | 21.11 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.21 |
EPS(TTM)11.91
EY3.83%
EPS(NY)13.37
Fwd EY4.3%
FCF(TTM)10.35
FCFY3.33%
OCF(TTM)14.73
OCFY4.74%
SpS36.88
BVpS-3.04
TBVpS-7.68
PEG (NY)5.88
PEG (5Y)3.18
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
WACC8.06%
ROIC/WACC2.2
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 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.
What are the PE and PB ratios of MCDONALD'S CORP (MCD) stock?
The Price/Earnings (PE) ratio for MCDONALD'S CORP (MCD) is 26.09 and the Price/Book (PB) ratio is -102.33.
How financially healthy is MCDONALD'S CORP?
The financial health rating of MCDONALD'S CORP (MCD) is 5 / 10.