McDonald's to Offer Healthier Options - Analyst Blog


In an effort to provide healthier food and beverage options to its customers, worlds' leading fast food chain, McDonald's Corp. ( MCD ) recently teamed up with the Alliance for a Healthier Generation, a non-profit organization, and announced the Clinton Global Initiative (CGI) Commitment at the 2013 CGI Annual Meeting in New York City. 

Formed by Clinton Foundation and American Heart Association, Alliance for a Healthier Generation spreads awareness among the people regarding childhood obesity and provides solutions to develop healthy food habits among the kids. 

The purpose of this agreement is to encourage the company's customers to have healthier foods rather than processed foods such as French fries. McDonald's will be adding several low-fat food items such as salads, fruits and vegetables in its value meals. Under the CGI, the restaurateur will be concentrating on promoting water, milk and juice as a beverage choice in its Happy Meals, especially among kids. The company will be promoting these food items through innovative marketing methods targeted at children.

This commitment is in line with McDonald's' prior initiative, started in 2011, to offer nutritious and healthy products.

Initially, McDonald's in association with Alliance will launch these initiatives at 20 major locations including the U.S., which constitutes 85% of the company's total revenue. The company intends to execute 30%-50% of this initiative by 2016 and complete the implementation in these markets by 2020.

In today's world, obesity has become an epidemic. As per Alliance, nearly 1 out of 3 children is obese which has a serious health implication. Rising health concerns and increasing awareness about obesity and related diseases have led to the shift in consumer preference toward healthy and "good for you" products. We believe the Zacks Rank #3 (Hold) company's new efforts will help it to attract more health-conscious consumers.

Lately, several U.S. eateries have started offering healthier food options, following the consumers' preference for fresh, organic, nutritious and low-calorie food. Recently, the world's No.2 hamburger chain, Burger King Worldwide ( BKW ), launched a low-calorie crinkle-cut French fry - Satisfries. These fries contain 20% less calories than the regular ones.

Other Stocks to Consider

Other players in the restaurant industry that look attractive at the current levels include AFC Enterprises Inc. ( AFCE ) and Jack in the Box Inc. ( JACK ). All these restaurateurs carry a Zacks Rank #2 (Buy).

AFC ENTERPRISES (AFCE): Free Stock Analysis Report

BURGER KING WWD (BKW): Free Stock Analysis Report

JACK IN THE BOX (JACK): Free Stock Analysis Report

MCDONALDS CORP (MCD): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: AFCE , BKW , CGI , JACK , MCD

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