McDonald's (MCD) closed the most recent trading day at $263.91, moving -1.39% from the previous trading session. The stock fell short of the S&P 500, which registered a gain of 0.89% for the day. At the same time, the Dow added 0.74%, and the tech-heavy Nasdaq gained 1.29%.
Shares of the world's biggest hamburger chain have depreciated by 0.91% over the course of the past month, underperforming the Retail-Wholesale sector's gain of 1.33%, and the S&P 500's loss of 0.63%.
The investment community will be paying close attention to the earnings performance of McDonald's in its upcoming release. The company is slated to reveal its earnings on August 4, 2026. The company is expected to report EPS of $3.32, up 4.08% from the prior-year quarter. At the same time, our most recent consensus estimate is projecting a revenue of $7.14 billion, reflecting a 4.27% rise from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $12.86 per share and revenue of $28.34 billion, which would represent changes of +5.41% and +5.42%, respectively, from the prior year.
Investors should also take note of any recent adjustments to analyst estimates for McDonald's. These revisions typically reflect the latest short-term business trends, which can change frequently. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 0.51% fall in the Zacks Consensus EPS estimate. Right now, McDonald's possesses a Zacks Rank of #4 (Sell).
Looking at valuation, McDonald's is presently trading at a Forward P/E ratio of 20.81. This denotes a premium relative to the industry average Forward P/E of 20.47.
We can also see that MCD currently has a PEG ratio of 2.87. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Restaurants was holding an average PEG ratio of 1.99 at yesterday's closing price.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 207, putting it in the bottom 16% of all 250+ industries.
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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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McDonald's Corporation (MCD): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).