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McDonald's (MCD) Temporarily Closes 850 Stores in Russia
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McDonald's Corporation (MCD - Free Report) recently announced the temporary closure of 850 stores in Russia in response to the country's invasion of Ukraine. However, the company stated that it would continue to pay 62,000 employees in Russia.
The company has also temporarily shut down 100 locations in Ukraine but will continue to pay its employees in the country.
CEO Chris Kempczinski said, “As we move forward, McDonald’s will continue to assess the situation and determine if any additional measures are required. At this juncture, it’s impossible to predict when we might be able to reopen our restaurants in Russia. We are experiencing disruptions to our supply chain along with other operational impacts. We will also closely monitor the humanitarian situation.”
Closing of stores in Russia will cost the company nearly $50 million per month. Currently, Russia and Ukraine make up nearly 2% of McDonald’s systemwide sales, which represents approximately 9% of its global revenues. Most of the stores in Russia and Ukraine are directly owned and operated by McDonald’s.
Image Source: Zacks Investment Research
Stock Price Performance
Shares of the company have gained 7.6% in the past year, against the industry’s decline of 11.4%. McDonald’s believes that there is a huge opportunity to grow all its brands globally by expanding its presence in existing markets and entering new ones. Its expansion efforts continue to drive performance. Despite the pandemic, the company continues to broaden its global footprint. It is planning to open more than 1,800 restaurants globally in 2022, which includes 500 openings in the United States and IOM segment and 1,300 (including nearly 800 in China) new restaurants in the IDL market. The company anticipates restaurant growth of nearly 3.5% for 2022.
Genesco sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 2,739.6%, on average. Shares of the company have gained 26.4% in the past year.
The Zacks Consensus Estimate for Genesco’s 2022 sales and EPS suggests growth of 35.5% and 677.1%, respectively, from the year-ago period’s levels.
Arcos Dorados carries a Zacks Rank #2 (Buy). ARCO has a long-term earnings growth of 24.7%. Shares of the company have surged 48.6% in the past year.
The Zacks Consensus Estimate for Arcos Dorados’ 2022 sales and EPS suggests growth of 35% and 120.8%, respectively, from the year-ago period’s levels.
Tapestry carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 28.2%, on average. Shares of the company have declined 17% in the past year.
The Zacks Consensus Estimate for Tapestry’s 2022 sales and EPS suggests growth of 17.5% and 22.9%, respectively, from the year-ago period’s levels.
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McDonald's (MCD) Temporarily Closes 850 Stores in Russia
McDonald's Corporation (MCD - Free Report) recently announced the temporary closure of 850 stores in Russia in response to the country's invasion of Ukraine. However, the company stated that it would continue to pay 62,000 employees in Russia.
The company has also temporarily shut down 100 locations in Ukraine but will continue to pay its employees in the country.
CEO Chris Kempczinski said, “As we move forward, McDonald’s will continue to assess the situation and determine if any additional measures are required. At this juncture, it’s impossible to predict when we might be able to reopen our restaurants in Russia. We are experiencing disruptions to our supply chain along with other operational impacts. We will also closely monitor the humanitarian situation.”
Closing of stores in Russia will cost the company nearly $50 million per month. Currently, Russia and Ukraine make up nearly 2% of McDonald’s systemwide sales, which represents approximately 9% of its global revenues. Most of the stores in Russia and Ukraine are directly owned and operated by McDonald’s.
Image Source: Zacks Investment Research
Stock Price Performance
Shares of the company have gained 7.6% in the past year, against the industry’s decline of 11.4%. McDonald’s believes that there is a huge opportunity to grow all its brands globally by expanding its presence in existing markets and entering new ones. Its expansion efforts continue to drive performance. Despite the pandemic, the company continues to broaden its global footprint. It is planning to open more than 1,800 restaurants globally in 2022, which includes 500 openings in the United States and IOM segment and 1,300 (including nearly 800 in China) new restaurants in the IDL market. The company anticipates restaurant growth of nearly 3.5% for 2022.
McDonald's currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Key picks
Some better-ranked stocks in the Zacks Retail-Wholesale sector include Genesco Inc. (GCO - Free Report) , Arcos Dorados Holdings Inc. (ARCO - Free Report) and Tapestry, Inc. (TPR - Free Report) .
Genesco sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 2,739.6%, on average. Shares of the company have gained 26.4% in the past year.
The Zacks Consensus Estimate for Genesco’s 2022 sales and EPS suggests growth of 35.5% and 677.1%, respectively, from the year-ago period’s levels.
Arcos Dorados carries a Zacks Rank #2 (Buy). ARCO has a long-term earnings growth of 24.7%. Shares of the company have surged 48.6% in the past year.
The Zacks Consensus Estimate for Arcos Dorados’ 2022 sales and EPS suggests growth of 35% and 120.8%, respectively, from the year-ago period’s levels.
Tapestry carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 28.2%, on average. Shares of the company have declined 17% in the past year.
The Zacks Consensus Estimate for Tapestry’s 2022 sales and EPS suggests growth of 17.5% and 22.9%, respectively, from the year-ago period’s levels.