McDonald's (MCD) closed at $173.23 in the latest trading session, marking a -0.06% move from the prior day. This move was narrower than the S&P 500's daily loss of 0.66%. At the same time, the Dow lost 0.99%, and the tech-heavy Nasdaq lost 1.63%.
Heading into today, shares of the world's biggest hamburger chain had gained 4.09% over the past month, outpacing the Retail-Wholesale sector's loss of 12.76% and the S&P 500's loss of 8.1% in that time.
Wall Street will be looking for positivity from MCD as it approaches its next earnings report date. This is expected to be January 29, 2019. In that report, analysts expect MCD to post earnings of $1.90 per share. This would mark year-over-year growth of 11.11%. Our most recent consensus estimate is calling for quarterly revenue of $5.16 billion, down 3.36% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $7.75 per share and revenue of $21.02 billion, which would represent changes of +16.37% and -7.91%, respectively, from the prior year.
Any recent changes to analyst estimates for MCD should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.31% higher. MCD is currently a Zacks Rank #2 (Buy).
In terms of valuation, MCD is currently trading at a Forward P/E ratio of 22.37. This valuation marks a premium compared to its industry's average Forward P/E of 22.3.
Also, we should mention that MCD has a PEG ratio of 2.55. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MCD's industry had an average PEG ratio of 1.8 as of yesterday's close.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 160, which puts it in the bottom 37% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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