[ad_1]
McDonald’s (MCD) on Thursday posted fourth quarter profit lower than Wall Street expectations, but the fast food giant got sales boost thanks to COVID-19 trends in menu innovation, take-out and mobile control.
Here’s what the Chicago-based fast food restaurant posted, compared to Wall Street expectations, according to a consensus estimate from Bloomberg:
-
Returned: 5.31 billion dollars against 5.37 billion dollars expected
-
Adj. earnings per share (EPS): $ 1.70 vs. $ 1.77 per share expected
-
Comparable sales in the United States: 5.5% vs. 4.89% expected
-
Comparable international sales: -1.3% vs. -4.32% expected
The Golden Arches said sales in the United States were supported by an increase in average check size, leading to “positive comparable sales” linked to “strategic investments in marketing and promotional activity” for newcomers. menu items.
McDonald’s President and CEO Chris Kempczinski said that “2020 will be remembered as one of the toughest, but most inspiring, McDonald’s times in our long history. The resilience of the McDonald’s system was on display – making safety and service a priority, putting our customers and people first, and running great restaurants. “
On Monday, the home of the Big Mac and the Quarter Pounder, announced that Spicy Chicken McNuggets and Mighty Hot Sauce are making their return for a limited time only, starting February 1. And on February 24, McDonald’s will jump into the chicken sandwich war with three different iterations of the crispy chicken sandwich: Classic, Deluxe, and Spicy.
Wall Street and Main Street are also rallying around the planned launch of McPlant, a plant-based burger, created by and for the fast food chain.
Like many restaurant chains, McDonald’s has kept sales afloat through menu innovation and an aggressive shift to mobile ordering that allows customers to order ahead, then grab their food and to leave.
“By investing for the future and leveraging the competitive strengths of our Accelerating the Arches strategy for drive-thru, delivery and our growing digital presence, we are confident that we can continue to capture market share and to stimulate long-term sustainable growth for all stakeholders. McDonald’s President and CEO Chris Kempczinski said Thursday.
And after a year devoted primarily to digital, delivery and drive-thru, analysts are optimistic about the fast-food giant’s long-term recovery.
JP Morgan analyst John Ivankoe noted Monday that McDonald’s is “well capitalized” and well positioned to recover in the post-COVID era, “as evidenced by a near-record 12% gain in comparable sales released in September 2020. “
Compared to other similar fast food giants such as Brands (YUM), Starbucks (SBUX) and Dominos (DPZ), the valuation of Golden Arches is comparatively better, Ivankoe noted.
JP Morgan remains overweight McDonald’s stocks, with a 12-month price target of $ 215. “We believe that the valuation of McDonald’s should be of a longer term nature,” added the analyst.
In a recent note, RBC Capital Markets analyst Christopher Carril said he was closely monitoring “relative changes in revenue trends” and foot traffic – including those from other giants like Restaurant Brands International (QSR), Wendy’s (WEN) and YUM !.
For McDonald’s in Q4, he’ll also be looking for “delayed momentum for the start of Q3, with a lead line aided by continued promotion of celebrity meals and the McRib.”
In December, it weighed on that.
“I think McDonald’s has done a good job increasing sales with the McRib with better marketing … there will be a good catalyst for at least the first part of 2021,” said UBS restaurant analyst Dennis Geiger. at Yahoo Finance Live. month.
“So from a sales perspective, there will be some good numbers that you see from them,” he added.
BTIG analyst Peter Saleh of BTIG is also considering menu innovation. In a November note, he reiterated the company’s “Buy” rating and its price target of $ 245, with a nod to new menu items like McPlant, McRib, and Crispy Chicken.
Shares of McDonald’s, which closed down $ 207.83 per share on Wednesday, fell slightly on the pre-market.
Brooke DiPalma is a producer and reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma.
READ MORE:
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, SmartNews, LinkedIn, Youtube, and reddit.
[ad_2]
Source link