McDonald's (MCD - Free Report) closed at $216.23 in the latest trading session, marking a +1.66% move from the prior day. This change outpaced the S&P 500's 1.54% gain on the day. At the same time, the Dow added 1.59%, and the tech-heavy Nasdaq gained 0.98%.
Prior to today's trading, shares of the world's biggest hamburger chain had gained 6.69% over the past month. This has lagged the Retail-Wholesale sector's gain of 11.47% and the S&P 500's gain of 8% in that time.
MCD will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.81, down 14.22% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $5.24 billion, down 3.6% from the year-ago period.
MCD's full-year Zacks Consensus Estimates are calling for earnings of $5.84 per share and revenue of $19.05 billion. These results would represent year-over-year changes of -25.51% and -9.63%, respectively.
Investors should also note any recent changes to analyst estimates for MCD. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable 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. The Zacks Consensus EPS estimate has moved 0.68% lower within the past month. MCD is currently sporting a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that MCD has a Forward P/E ratio of 36.43 right now. For comparison, its industry has an average Forward P/E of 35.34, which means MCD is trading at a premium to the group.
Also, we should mention that MCD has a PEG ratio of 4.74. 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. The Retail - Restaurants industry currently had an average PEG ratio of 3.72 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 111, which puts it in the top 44% 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.
To follow MCD in the coming trading sessions, be sure to utilize Zacks.com.