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McDonald's (MCD) Stock Declines While Market Improves: Some Information for Investors

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McDonald's (MCD - Free Report) ended the recent trading session at $294.48, demonstrating a -1.22% change from the preceding day's closing price. The stock's change was less than the S&P 500's daily gain of 0.07%. Meanwhile, the Dow lost 0.7%, and the Nasdaq, a tech-heavy index, added 0.18%.

Shares of the world's biggest hamburger chain witnessed a gain of 4.4% over the previous month, trailing the performance of the Retail-Wholesale sector with its gain of 5.27%, and the S&P 500's gain of 5.71%.

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 August 6, 2025. It is anticipated that the company will report an EPS of $3.15, marking a 6.06% rise compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $6.71 billion, indicating a 3.43% upward movement from the same quarter last year.

MCD's full-year Zacks Consensus Estimates are calling for earnings of $12.27 per share and revenue of $26.42 billion. These results would represent year-over-year changes of +4.69% and +1.94%, respectively.

Investors should also pay attention to any latest changes in analyst estimates for McDonald's. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.23% upward. As of now, McDonald's holds a Zacks Rank of #3 (Hold).

In terms of valuation, McDonald's is currently trading at a Forward P/E ratio of 24.29. This expresses a premium compared to the average Forward P/E of 22.47 of its industry.

Investors should also note that MCD has a PEG ratio of 3.12 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As the market closed yesterday, the Retail - Restaurants industry was having an average PEG ratio of 2.63.

The Retail - Restaurants industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 163, this industry ranks in the bottom 35% of all industries, numbering over 250.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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