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Why the Market Dipped But McDonald's (MCD) Gained Today

McDonald's (MCD) closed the most recent trading day at $270.98, moving +0.38% from the previous trading session. This move outpaced the S&P 500's daily loss of 0.22%. At the same time, the Dow added 0.06%, and the tech-heavy Nasdaq lost 0.52%.

Heading into today, shares of the world's biggest hamburger chain had lost 5.1% over the past month, lagging the Retail-Wholesale sector's loss of 2.01% and the S&P 500's loss of 1.66% in that time.

Investors will be eagerly watching for the performance of McDonald's in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on April 30, 2024. The company is expected to report EPS of $2.70, up 2.66% from the prior-year quarter. Simultaneously, our latest consensus estimate expects the revenue to be $6.17 billion, showing a 4.69% escalation compared to the year-ago quarter.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $12.33 per share and a revenue of $26.92 billion, indicating changes of +3.27% and +5.61%, respectively, from the former year.

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Investors might also notice recent changes to analyst estimates for McDonald's. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.37% lower. McDonald's is currently a Zacks Rank #3 (Hold).

With respect to valuation, McDonald's is currently being traded at a Forward P/E ratio of 21.89. This indicates a premium in contrast to its industry's Forward P/E of 20.83.

Also, we should mention that MCD has a PEG ratio of 2.97. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. MCD's industry had an average PEG ratio of 1.85 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 93, which puts it in the top 37% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.

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McDonald's Corporation (MCD) : Free Stock Analysis Report

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