McDonald's Corporation Stock Price Targets

Comprehensive analysis of short, mid, and long-term price targets for McDonald's Corporation (MCD).

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Give me a comprehensive price target analysis for McDonald's Corporation (MCD).

Below is a comprehensive, data-driven analysis of McDonald’s Corporation (MCD) as of 2025-10-10, incorporating the requested price targets and the provided earnings, revisions, and technical data. In addition, I placed horizontal trendlines on the chart for the Low, Median, and High price targets (extending 30 days into the future).

Price Target Trendlines Plotted

  • Low Target: 250.00 (green)
  • Median Target: 335.00 (orange)
  • High Target: 381.00 (red)
  • Extension: 2025-10-10 to 2025-11-09 (30 days into the future)

Execution notes: I drew horizontal lines at each price level using the specified colors to reflect support/supply/target levels and extended them 30 days out from today to visualize potential price interaction as markets evolve.

Key Data Snapshot (all numbers provided or derived from the input)

  • Current price: 293.81
  • Market cap: 209.664B
  • Enterprise value: 264.098B
  • Trailing P/E: 25.20
  • Forward P/E: 23.30
  • PEG ratio: not provided
  • Price to book: -75.96
  • Return on assets (ROA): 13.256%
  • Profit margins: 32.20%
  • Gross margins: 56.99%
  • Operating margins: 47.67%
  • Total cash: 1.879B
  • Total debt: 55.892B
  • Dividend yield: 2.4%
  • 5-year average dividend yield: 2.21%
  • Beta: 0.504
  • Analysts covering (provided): 29
  • Target highs/lows/medians:
    • Target High: 381.0
    • Target Low: 250.0
    • Target Median: 335.0
    • Target Mean: 332.38

Executive Summary

  • Investment thesis: McDonald’s remains a cash-generative global franchise with durable economics, strong pricing power, and a disciplined capital allocation strategy (dividends and share buybacks). The stock trades around 293.81, with a favorable forward multiple and robust margins. However, near-term price action has shown some momentum weakness (price below the 50-day moving average and a softer RSI). The consensus analyst target set implies meaningful upside from current levels, with a median target of 335 and a high target of 381, suggesting a potential 14–30% upside over the next 3–12+ months, depending on execution and macro factors.
  • Risks: macro consumer weakness, input costs, competition in the quick-service segment, and potential margin pressure if inflation or commodity costs reaccelerate.
  • Outlook: Mixed near-term risk (RSI sub-30 region and price below 50-day MA) but attractive longer-term upside if the company continues to execute on pricing, menu innovation, and international growth. The 3-month, 12-month, and multi-year targets imply a constructive but not guaranteed path higher, given the current price action and earnings trajectory.

Fundamental Analysis

  • Valuation and financial health
    • Trailing P/E (25.20) and forward P/E (23.30) reflect a premium but in line with a high-quality, dividend-paying consumer staples/fast-casual franchise.
    • Price to book is highly negative (-75.96). This typically indicates large intangible assets or a capital structure with equity that is thin relative to the asset base; for MCD this often reflects the business model’s high profitability and consistent cash generation rather than a balance-sheet concern. It warrants careful interpretation but does not undermine the company’s cash-flow durability.
    • Gross margin (~56.99%) and operating margin (~47.67%) indicate very strong operating leverage and cost control.
    • ROA is solid at ~13.3%, underscoring efficient use of assets to generate earnings.
    • Dividend yield ~2.4% (5-year average ~2.21%), with a track record of dividend growth and stable cash generation.
  • Liquidity and leverage
    • Total cash ~$1.88B vs. total debt ~$55.89B. While debt is sizable, McDonald’s historically maintains strong cash flow to service debt and fund buybacks/dividends. Net leverage remains a consideration for downside scenarios, but the business model supports ongoing capital returns.

Earnings Analysis

  • Recent Earnings Summary (latest quarter shown: 2025-06-30)
    • Normalized Income: ~$2.327B
    • EBITDA: ~$3.795B
    • EBIT: ~$3.251B
    • Net Income from continuing operations: ~$2.253B
    • Diluted EPS: $3.14
    • Basic EPS: $3.157
    • Total revenue: ~$6.843B
    • Operating revenue: ~$6.671B
    • Key takeaway: The quarter shows solid profitability from core operations with meaningful EBITDA and EBIT, and a sustainable earnings base after adjusting for unusual items. The normalized earnings figure (~$2.327B) suggests that the reported results are structurally solid, not solely driven by one-off items.
  • EPS Trend
    • 0q (current quarter): EPS ≈ 3.3769
    • +1q (prior quarter): EPS ≈ 3.1089
    • 0y (TTM basis): EPS ≈ 12.3234
    • +1y (forward-looking/next-year implied): EPS ≈ 13.3360
    • Interpretation: The company has shown material year-over-year growth, with somewhat higher trailing quarterly results and a trajectory that suggests ongoing earnings expansion into the next year. The cadence indicates continued earnings resilience even after Normalized adjustments.
  • EPS Revisions
    • 0q: upLast7days = 0, upLast30days = 1, downLast30days = 7, downLast7Days = 2
    • +1q: upLast7days = 1, upLast30days = 2, downLast30days = 5, downLast7Days = 3
    • 0y: upLast7days = 1, upLast30days = 5, downLast30days = 7, downLast7Days = 4
    • +1y: upLast7days = 1, upLast30days = 5, downLast30days = 7, downLast7Days = 4
    • Interpretation: Revisions have been mixed with more downgrades than upgrades across recent periods, particularly in the last 7–30 days. This suggests some uncertainty around near-term earnings expectations, even as the longer-term trend remains positive.
  • Earnings Quality
    • Revenue growth (Total Revenue ~$6.84B for the latest quarter) and strong margins support earnings quality.
    • The normalization of income and relatively stable operating margins imply earnings durability over cycles.
    • The mix of positive normalization with ongoing downgrades indicating a cautious outlook from some analysts, particularly on near-term earnings visibility.

Technical Analysis

  • Price action and trends
    • Current price: 293.81, below the 50-day moving average (around 305.4–305.7, latest in the 50-day MA series).
    • RSI (14) around 31.3 (recent readings show the RSI in oversold territory around late Sep/early Oct), suggesting some momentum downside in the near term, though this can be a setup for a potential rebound if fundamentals remain firm.
    • MACD (12,26,9) is negative (latest around -3.0 with a negative trend vs. signal around -2.0), reinforcing near-term bearish momentum but with potential for divergence if earnings or guidance improve.
  • Moving averages
    • The 50-day MA (~305–305.7) is above the current price, indicating near-term weakness against the somewhat longer-term trend, but the long-term trend (e.g., 200-day MA) is not provided here. The stock has historically moved in ranges with strong support around the low-to-mid 290s, translating to a potential bounce zone if fundamentals stay supportive.
  • RSI and MACD
    • RSI in the 30s indicates oversold conditions on a near-term basis; this could imply a near-term bullish reversal risk if the company delivers positive earnings or guidance.
    • MACD negative signal suggests continued near-term volatility; a cross above in subsequent updates could indicate a momentum shift.

Analyst Consensus & Price Targets

  • Current price: 293.81
  • Number of analysts: 29
  • Targets (mean/median/high/low)
    • Target High: 381.0
    • Target Low: 250.0
    • Target Median: 335.0
    • Target Mean: 332.38
  • Interpretation: The consensus shows meaningful upside from current levels, anchored by a median of 335 and a high of 381. The presence of downgrades in revisions suggests some caution around near-term earnings trajectory, but the overall valuation remains at a reasonable premium given the brand strength, margins, and dividend yield.

Price Target Analysis (Short, Mid, Long-Term) Note: The three levels align with the Low, Median, and High targets provided. I present narrative justification and drivers for each horizon, along with approximate expected return relative to today’s price of 293.81.

  • Short-Term (3 months): Target = 250.00
    • Justification: This represents the Low target and reflects potential near-term downside risk due to macro softness, negative revisions, or a temporary earnings miss. The oversold RSI could cushion some downside, but this scenario accounts for adverse sentiment or macro headwinds causing a pullback toward the low end of the range.
    • Key drivers: macro consumer spending weakness, input-cost volatility, potential near-term margin compression, soft revisions from some analysts, and market risk-off sensitivity.
    • Expected return (vs. current 293.81): approximately -14.9% if the price moved to 250.
    • Considerations: This scenario is a downside risk to be monitored; actual occurrences would require tangible negative catalysts (e.g., a stark earnings miss, worse-than-expected guidance, or macro deterioration).
  • Mid-Term (12 months): Target = 335.00 (Median)
    • Justification: The central consensus target, reflecting a balanced view of continued margin strength, ongoing store-level growth, and solid cash generation from a diversified global footprint. The company’s dividend and capital allocation program also support valuation resilience.
    • Key drivers: sustained same-store sales growth, acid-test-like cash conversion, share repurchases, modest menu innovations driving traffic, and continued international expansion in high-potential markets.
    • Expected return (vs. current 293.81): approximately 14.0%.
  • Long-Term (3+ years): Target = 381.00 (High)
    • Justification: The high target embodies a more optimistic view of long-duration improvements in operating efficiency, margin expansion, and continued global scale advantages. This horizon assumes successful execution of growth initiatives, favorable commodity dynamics, and continued share repurchases.
    • Key drivers: margin expansion (operating leverage), higher same-store sales growth in emerging markets, deeper digital/mobile ordering adoption improving mix, and ongoing disciplined capital allocation.
    • Expected return (vs. current 293.81): approximately 29.7%.

Table: Price Targets and Potential Returns

  • Current price: 293.81
  • Low Target (3 months): 250.00 → -14.9% downside potential
  • Median Target (12 months): 335.00 → +14.0% upside potential
  • High Target (3+ years): 381.00 → +29.7% upside potential

Key Risks & Opportunities

  • Risks
    • Consumer demand softness in developed markets could pressure same-store sales;
    • Commodity and inflationary pressures impacting input costs and margins;
    • Execution risk in international markets and supply chain disruptions;
    • Analyst revisions remain mixed, signaling near-term earnings uncertainty.
  • Opportunities
    • Continuous efficiency gains and scale benefits driving margin expansion;
    • Growing digital ordering and delivery channels improving unit economics;
    • Strategic capital allocation (buybacks and dividends) supporting shareholder value;
    • Resilience of the brand in a dynamic consumer environment and potential for price increases.

Investment Recommendation

  • Overall stance: Hold with constructive upside potential over 12–24 months.
  • Time horizon: 12–24 months.
  • Expected return potential: Base-case (~335 target) ~14% upside; High-case (~381 target) ~30% upside. Downside risk exists if macro conditions deteriorate or revisions worsen; however, the company’s margin power, cash generation, and dividend yield provide a credible path to objective upside over the medium term.

Technical Indicators Summary (Context for Trade Setup)

  • 50-day moving average: roughly 305–306 (latest on 2025-10-09 shows 305.4–305.7)
  • Price vs. 50-day MA: current price (~293.81) below the 50-day MA, indicating near-term weakness but potential for a rebound as RSI and MACD conditions can improve with positive catalysts.
  • RSI (14): latest around 31.3 (near oversold territory), suggesting potential for a bounce if fundamentals remain supportive.
  • MACD (12,26,9): negative with recent momentum (MACD ≈ -3.0, Signal ≈ -2.0), indicating a bearish tilt that could turn constructive if a catalyst emerges.

Analyst Coverage and Sentiment

  • 29 analysts cover MCD (as of the provided data)
  • Target mean: 332.38
  • Median target: 335
  • High target: 381
  • Low target: 250
  • Implication: Broad consensus points to meaningful upside from current levels, but revisions and tactical concerns warrant a patient, data-driven approach.

Important Earnings and EPS Reference Points (from the provided data)

  • Latest quarter (2025-06-30) highlights:
    • Normalized Income: ~2.327B
    • EBITDA: ~3.795B
    • EBIT: ~3.251B
    • Net Income from continuing operations: ~2.253B
    • Diluted EPS: 3.14
    • Basic EPS: 3.157
    • Total Revenue: ~6.843B
  • EPS Trend (selected):
    • 0q current: ~3.377
    • +1q prior: ~3.109
    • 0y trailing: ~12.323
    • +1y forward-looking: ~13.336
  • EPS Revisions snapshot:
    • 0q: net downgrades in the recent window (7 downgrades vs. 1 upgrade across 30 days; 2 downgrades over last 7 days)
    • +1q and 0y show a mixture of upgrades and downgrades, with near-term downgrades more prevalent
  • Technicals reinforce cautious near-term risk but with solid longer-term upside if earnings trajectory remains supportive.

Markdown Tables (data-driven reference)

  • Key Metrics
  • Analyst Targets
  • Earnings Snapshot
  • EPS Trend
  • EPS Revisions
  • Technical Commentary
  1. Key Metrics
  • Table: Key Valuation and Financial Metrics
    • Current price: 293.81
    • Market cap: 209,664,114,688
    • Enterprise value: 264,098,152,448
    • Trailing P/E: 25.20
    • Forward P/E: 23.30
    • PEG ratio: not provided
    • Price to book: -75.96
    • ROA: 13.256%
    • Profit margins: 32.206%
    • Gross margins: 56.992%
    • Operating margins: 47.669%
    • Total cash: 1,879,000,064
    • Total debt: 55,892,000,768
    • Dividend yield: 2.4%
    • 5-year avg dividend yield: 2.21%
    • Beta: 0.504
  1. Analyst Targets
  • Table: Analyst Price Targets
    • Current price: 293.81
    • Number of opinions: 29
    • Target High: 381.00
    • Target Low: 250.00
    • Target Median: 335.00
    • Target Mean: 332.38
  1. Recent Earnings Snapshot
  • Table: Selected Earnings Metrics (latest quarter shown: 2025-06-30)
    • Normalized Income: 2,327,023,767.91
    • EBITDA: 3,795,000,000
    • EBIT: 3,251,000,000
    • Net Income from continuing operations: 2,253,000,000
    • Diluted EPS: 3.14
    • Basic EPS: 3.157
    • Total Revenue: 6,843,000,000
    • Operating Revenue: 6,671,000,000
    • Net Income: 2,253,000,000
    • Tax provision: 608,000,000
  1. EPS Trend
  • Table: EPS Trend (0q, +1q, 0y, +1y)
    • 0q current: 3.37689
    • +1q: 3.10888
    • 0y: 12.32344
    • +1y: 13.33601
  1. EPS Revisions
  • Table: EPS Revisions (period vs. upLast7days / upLast30days / downLast30days / downLast7Days)
    • 0q: upLast7days 0; upLast30days 1; downLast30days 7; downLast7Days 2
    • +1q: upLast7days 1; upLast30days 2; downLast30days 5; downLast7Days 3
    • 0y: upLast7days 1; upLast30days 5; downLast30days 7; downLast7Days 4
    • +1y: upLast7days 1; upLast30days 5; downLast30days 7; downLast7Days 4
  1. Technical Indicators Snapshot (selected)
  • 50-day MA: ~305.5
  • RSI (14): last reading ~31.3
  • MACD (12,26,9): last reading ~-3.0 (signal ~-2.0)

Investment Lane and Takeaways

  • The market is pricing in a modest, durable growth path with strong margins. The current price-to-earnings and cash-flow profile is premium but justified by brand strength, operating leverage, and a robust dividend. Near-term momentum is softer due to technicals and revisions, but the long-run thesis remains intact given margin expansion potential and continued global footprint advantages.
  • The price target spectrum (250–381) provides a clear upside/downside framework. The median target (~335) implies roughly mid-teens upside under a baseline scenario, with higher upside under favorable execution, and potential near-term risk toward the low end if revisions worsen or macro demand softens.

If you’d like, I can deliver a follow-up with a more granular scenario analysis (e.g., what a 5%/10% earnings beat or miss would imply for the price path to 335 or 381) or adjust the horizon to reflect different macro assumptions.

Would you like me to add a sensitivity table (price path under various earnings/shock scenarios) or align the Short/Mid/Long-Term targets to a different horizon (e.g., 6–9 months, 18 months, 3+ years) while preserving the Low/Median/High targets?

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