MCDONALD'S CORP (MDO.DE) Stock Fundamental Analysis
FRA:MDO - Deutsche Boerse Ag - US5801351017 - Common Stock - Currency: EUR
We assign a fundamental rating of 5 out of 10 to MDO. MDO was compared to 53 industry peers in the Hotels, Restaurants & Leisure industry. While MDO belongs to the best of the industry regarding profitability, there are concerns on its financial health. While showing a medium growth rate, MDO is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year MDO was profitable.
MDO had a positive operating cash flow in the past year.
Each year in the past 5 years MDO has been profitable.
In the past 5 years MDO always reported a positive cash flow from operatings.
1.2 Ratios
MDO has a Return On Assets of 14.68%. This is amongst the best in the industry. MDO outperforms 91.11% of its industry peers.
MDO's Return On Invested Capital of 18.87% is amongst the best of the industry. MDO outperforms 91.11% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MDO is significantly above the industry average of 11.62%.
The last Return On Invested Capital (18.87%) for MDO 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
MDO's Profit Margin of 31.79% is amongst the best of the industry. MDO outperforms 95.56% of its industry peers.
MDO's Profit Margin has improved in the last couple of years.
The Operating Margin of MDO (45.52%) is better than 97.78% of its industry peers.
MDO's Operating Margin has improved in the last couple of years.
MDO has a Gross Margin (56.62%) which is in line with its industry peers.
In the last couple of years the Gross Margin of MDO 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), MDO is creating value.
MDO has less shares outstanding than it did 1 year ago.
MDO has less shares outstanding than it did 5 years ago.
The debt/assets ratio for MDO is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.76 indicates that MDO is not in any danger for bankruptcy at the moment.
MDO has a Altman-Z score of 4.76. This is amongst the best in the industry. MDO outperforms 93.33% of its industry peers.
The Debt to FCF ratio of MDO is 6.02, which is on the high side as it means it would take MDO, 6.02 years of fcf income to pay off all of its debts.
MDO's Debt to FCF ratio of 6.02 is in line compared to the rest of the industry. MDO outperforms 51.11% of 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
MDO has a Current Ratio of 0.78. This is a bad value and indicates that MDO is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.78, MDO is not doing good in the industry: 64.44% of the companies in the same industry are doing better.
A Quick Ratio of 0.77 indicates that MDO may have some problems paying its short term obligations.
With a Quick ratio value of 0.77, MDO is not doing good in the industry: 62.22% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.78 | ||
| Quick Ratio | 0.77 |
3. Growth
3.1 Past
MDO shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 2.33%.
Measured over the past years, MDO shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.75% on average per year.
MDO shows a small growth in Revenue. In the last year, the Revenue has grown by 3.69%.
Measured over the past years, MDO shows a small growth in Revenue. The Revenue has been growing by 3.70% on average per year.
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
Based on estimates for the next years, MDO will show a small growth in Earnings Per Share. The EPS will grow by 7.17% on average per year.
Based on estimates for the next years, MDO will show a small growth in Revenue. The Revenue will grow by 4.77% on average per year.
EPS Next Y-0.37%
EPS Next 2Y2.8%
EPS Next 3Y4.48%
EPS Next 5Y7.17%
Revenue Next Year2.09%
Revenue Next 2Y2.8%
Revenue Next 3Y3.6%
Revenue Next 5Y4.77%
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.
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 24.22, MDO is valued on the expensive side.
The rest of the industry has a similar Price/Earnings ratio as MDO.
MDO's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.47.
MDO is valuated rather expensively with a Price/Forward Earnings ratio of 22.75.
MDO's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of MDO to the average of the S&P500 Index (92.74), we can say MDO is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.22 | ||
| Fwd PE | 22.75 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MDO is valued a bit more expensive than the industry average as 60.00% of the companies are valued more cheaply.
Based on the Price/Free Cash Flow ratio, MDO is valued a bit more expensive than 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.27 | ||
| EV/EBITDA | 17.68 |
4.3 Compensation for Growth
MDO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.77
EPS Next 2Y2.8%
EPS Next 3Y4.48%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.44%, MDO has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.78, MDO pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.28, MDO has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.44% |
5.2 History
The dividend of MDO is nicely growing with an annual growth rate of 8.37%!
Dividend Growth(5Y)8.37%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
58.34% of the earnings are spent on dividend by MDO. This is a bit on the high side, but may be sustainable.
MDO's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP58.34%
EPS Next 2Y2.8%
EPS Next 3Y4.48%
MCDONALD'S CORP
FRA:MDO (2/5/2025, 12:40:46 PM)
277.8
-1.05 (-0.38%)
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 Cap199.08B
Analysts76.36
Price Target310.53 (11.78%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.44% |
Yearly Dividend6.24
Dividend Growth(5Y)8.37%
DP58.34%
Div Incr Years6
Div Non Decr Years6
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)-2.93%
PT rev (3m)4.44%
EPS NQ rev (1m)-1.45%
EPS NQ rev (3m)-6.49%
EPS NY rev (1m)-0.23%
EPS NY rev (3m)-0.34%
Revenue NQ rev (1m)-0.77%
Revenue NQ rev (3m)-4.71%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.22 | ||
| Fwd PE | 22.75 | ||
| P/S | 7.93 | ||
| P/FCF | 31.27 | ||
| P/OCF | 22.11 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.68 |
EPS(TTM)11.47
EY4.13%
EPS(NY)12.21
Fwd EY4.39%
FCF(TTM)8.88
FCFY3.2%
OCF(TTM)12.56
OCFY4.52%
SpS35.02
BVpS-6.99
TBVpS-11.34
PEG (NY)N/A
PEG (5Y)2.77
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-0.37%
EPS Next 2Y2.8%
EPS Next 3Y4.48%
EPS Next 5Y7.17%
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 5Y4.77%
EBIT growth 1Y2.58%
EBIT growth 3Y17.68%
EBIT growth 5Y6.35%
EBIT Next Year18.39%
EBIT Next 3Y9.82%
EBIT Next 5Y8.67%
FCF growth 1Y13.55%
FCF growth 3Y16.19%
FCF growth 5Y11.42%
OCF growth 1Y18.51%
OCF growth 3Y15.33%
OCF growth 5Y6.65%