McDonald’s (New York Stock Exchange: MCD) plans to report fourth quarter earnings on January 31. Its value proposition and well-diversified store base (spanning 100 countries) show that fast food chain operators can deliver strong sales in the fourth quarter despite economic uncertainty. increase. Cost headwinds may continue to weigh on margins, but EPS may show improvement on the back of revenue leverage.
Notably, McDonald’s grew global comparable sales by 10% last quarter. Meanwhile, US same-store sales increased 6%, marking the ninth straight quarter of sales growth.
McDonald’s has beaten the streets’ forecasts in the first three quarters of 2022. As for the fourth quarter, analysts expect McDonald’s to post earnings of $2.46 per share, up about 10% from a year ago.
Robert W. Baird analyst David Tarantino expects MCD’s global comparable revenue and EPS to beat estimates. Tarantino expects MCD to post his 8.7% global comparable sales growth. Additionally, analysts expect McDonald’s to report earnings of $2.44 per share in the fourth quarter.
Tarantino is bullish on MCD’s share price ahead of earnings and expects the company to deliver healthy results despite the challenging macroeconomic environment. “The McDonald’s brand has performed exceptionally well under the pressure of past recessions.”
MCD’s strong performance in a challenging macro environment is underpinned by its everyday value proposition.
Should I buy, sell or hold MCD stock?
McDonald’s stock is a moderate buy on TipRanks ahead of fourth-quarter earnings. It has received 9 buy recommendations and 4 hold recommendations. Meanwhile, analysts have a price target of $293.38, suggesting a 7.68% upside potential.