) has cooked up some plans on the corporate front to free up cash
and offer tastier dividends to shareholders.
The fast-food king last week announced plans to return money
to shareholders and expand franchising over the next two years.
CEO Don Thompson said at an investor conference May 28 that
McDonald's will return $18 billion to $20 billion to shareholders
through 2016, via dividends and stock buyback programs.
The Oak Brook, Ill.-based burger chain also plans to franchise
out at least 1,500 company-owned restaurants during the same time
frame. That would be a 50% pickup in franchising activity from
the past three years.
Rival chainsBurger King (
) andWendy's (
) have been making a push on the franchising front as well.
Shareholders might find the news appetizing, but fast-food
workers have been staging protests in the U.S. and abroad seeking
a pay hike to $15 per hour and the right to unionize. Seattle on
Monday became the first U.S. city to approve raising the hourly
minimum wage to $15 by 2017-21, though allowing a lower wage for
For shareholders, McDonald's currently pays a quarterly
dividend of 81 cents a share, or $3.24 on an annualized basis,
for a 3.2% yield vs. the S&P 500's 1.88%. It's a member of
the elite S&P 500 Dividend Aristocrats index, made up of
companies that have boosted their annual payouts for the past 25
Its three-year Earnings Stability Factor of 2 on a scale of 0
(most stable) to 99 (most volatile) underscores its 11-year track
record of steady profit growth. Analysts expect a 4% gain this
year and 9% the next.
The stock has been shaping a saucer base since April 2013 and
appears to have formed a handle with a 103.88 buy point, slightly
above the left-side high of 103.70.
Up weeks in above-average trade have outpaced heavy-volume
down weeks the past few months, a sign of institutional