McDonald’s Corporation (NYSE: MCD) is one of 22 publicly-traded companies in the “Quick Service Restaurants” industry, but how does it compare to its rivals? We will compare McDonald’s Corporation to related companies based on the strength of its valuation, earnings, dividends, profitability, institutional ownership, risk and analyst recommendations.
This is a summary of current ratings for McDonald’s Corporation and its rivals, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|McDonald’s Corporation Competitors||242||1343||1655||81||2.47|
McDonald’s Corporation currently has a consensus target price of $168.12, indicating a potential upside of 2.57%. As a group, “Quick Service Restaurants” companies have a potential upside of 6.71%. Given McDonald’s Corporation’s rivals higher possible upside, analysts clearly believe McDonald’s Corporation has less favorable growth aspects than its rivals.
This table compares McDonald’s Corporation and its rivals’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|McDonald’s Corporation Competitors||6.90%||12.59%||9.54%|
Institutional & Insider Ownership
67.9% of McDonald’s Corporation shares are owned by institutional investors. Comparatively, 79.8% of shares of all “Quick Service Restaurants” companies are owned by institutional investors. 0.2% of McDonald’s Corporation shares are owned by insiders. Comparatively, 16.8% of shares of all “Quick Service Restaurants” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
McDonald’s Corporation pays an annual dividend of $3.76 per share and has a dividend yield of 2.3%. McDonald’s Corporation pays out 61.5% of its earnings in the form of a dividend. As a group, “Quick Service Restaurants” companies pay a dividend yield of 1.5% and pay out 43.1% of their earnings in the form of a dividend. McDonald’s Corporation has raised its dividend for 40 consecutive years.
Earnings & Valuation
This table compares McDonald’s Corporation and its rivals top-line revenue, earnings per share and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|McDonald’s Corporation||$24.18 billion||$9.60 billion||26.83|
|McDonald’s Corporation Competitors||$3.06 billion||$846.52 million||29.71|
McDonald’s Corporation has higher revenue and earnings than its rivals. McDonald’s Corporation is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.
Volatility & Risk
McDonald’s Corporation has a beta of 0.69, meaning that its stock price is 31% less volatile than the S&P 500. Comparatively, McDonald’s Corporation’s rivals have a beta of 0.53, meaning that their average stock price is 47% less volatile than the S&P 500.
McDonald’s Corporation beats its rivals on 8 of the 15 factors compared.
About McDonald’s Corporation
McDonald’s Corporation (McDonald’s) operates and franchises McDonald’s restaurants. The Company’s restaurants serve a locally relevant menu of food and drinks sold at various price points in over 100 countries. The Company’s segments include U.S., International Lead Markets, High Growth Markets, and Foundational Markets and Corporate. The U.S. segment focuses on offering a platform for authentic ingredients that allows customers to customize their sandwiches. Its High Growth Markets segment includes its operations in markets, such as China, Italy, Korea, Poland, Russia, Spain, Switzerland, the Netherlands and related markets. The International Lead markets segment includes the Company’s operations in various markets, such as Australia, Canada, France, Germany, the United Kingdom and related markets. The Foundational markets and Corporate segment is engaged in operating restaurants and increasing convenience to customers, including through drive-thru and delivery.
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