Doesn’t
matter what your choice is – McDonald’s breakfast menu or lactose-free porridge
with granola and peanut butter. Anyway, you can’t ignore the fact that
McDonald’s is a phenomenon in the fast-food universe as well as in the stock
market. And despite the crisis and general situation in the world, the company
has presented financial reports with more impressive numbers than analysts had
expected. So, what’s next? Let’s try to investigate if McDonald’s still has
room for growth.

Since
the beginning of the year, McDonald’s stock has increased by almost 10%. As you
can see in the chart below, the shares have outperformed the S&P 500 and
Dow Jones indices.

You
could argue that there is not a large gap after a third of a year. That’s why
we prepared one more chart – it shows what has been going on with the same
symbols in the last five years. The picture below looks like a comparison
between a McFlurry and cheap supermarket ice cream. Also, you should know that
there are various factors which might influence the stock price. Some of them
are pretty unpredictable but lots of future market movements can be forecast
using a variety of trading tools. One of them is economic
calendar – it warns you about all upcoming major economic
events.

McDonald’s
has dropped its Q1 report suggesting that the company might continue its
positive movement. Earnings per share and revenue results beat analyst
expectations – $2.63 against $2.33 and $5.9 bln against $5.59 bln. Moreover,
net income and sales have grown as well.

However,
McDonald’s raised prices on the menu in the past year and crises around the world are influencing the
amount of spare cash people have. But the last thing might be even positive in
this case. The reason is – doesn’t matter if there’s a crisis or not – people
love cheap eats, and McDonald’s is the place to go for that.

Also,
the company reduced various costs recently – a large number of employees were
dismissed, and some offices were closed. This is one more positive factor for
McDonald’s balance between income and expenses. Such optimization gives an
opportunity to spend more money on business development and enlargement of
delivery capabilities.

And we
shouldn’t forget about the Chinese market. After the county eased off the Covid
restrictions, McDonald’s can count on increased profits in the region.

Though,
you shouldn’t look at the perspectives of McDonald’s shares only through
rose-colored glasses. Current market conditions present challenges for
businesses. Layoffs and shutting down the offices show that the situation in
the company is far from cloudless. Moreover, you should remember that if the
stock market goes down, MCD will probably do the same.

But
analysts continue to believe in McDonald’s shares. The consensus forecast is
+9% in the next 12 months. It might not be too impressive, but the forecast
says that the shares may be a good addition to the portfolio. But it’s just a
prediction, and it can be changed in a week or even tomorrow. That’s why before
buying (or selling) these stocks, you need to do your own analysis – only after
that, can you make an informed decision.

This article was written by ForexLive at www.forexlive.com.