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Valued at $213.4 billion by market cap, Chicago, Illinois-based McDonald's Corporation (MCD) owns, operates, and franchises over 38,000 restaurants in more than 100 countries across the globe. McDonald’s offerings include burgers, sandwiches, fries, shakes, desserts, soft serve cones, cookies, and more. The QSR giant has notably underperformed the broader market over the past year. MCD stock prices have gained 3.4% on a YTD basis and observed a modest 1.7% uptick over the past 52 weeks, notably underperforming the S&P 500 Index’s ($SPX) 14.4% gains in 2025 and 12.7% returns over the past year. Narrowing the focus, McDonald’s has also underperformed the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 5.1% uptick in 2025 and 11.2% gains over the past year. McDonald's stock prices gained 2.2% in the trading session following the release of its mixed Q3 results on Nov. 5. Despite the challenging macro environment, the company’s affordable menu combined with compelling marketing has continued to push its sales. MCD’s systemwide sales increased by 6% on a constant currency basis and 8% after including the impact of forex translation. This was supported by a solid 3.6% growth in comparable sales. Overall, its topline grew 3% year-over-year to $7.1 billion, beating the Street’s expectations by 15 bps. However, the company’s adjusted EPS declined by 31 bps to $3.22 and missed the consensus estimates by 3.9%. For the full fiscal 2025, ending in December, analysts expect MCD to deliver an adjusted EPS of $12.15, up 3.7% year-over-year. The company has a mixed earnings surprise history. While it missed the Street’s bottom-line expectations once over the past four quarters, it met or surpassed the projections on three other occasions. Among the 36 analysts covering the MCD stock, the consensus rating is a “Moderate Buy.” That’s based on 14 “Strong Buys,” one “Moderate Buy,” 20 “Holds,” and one “Strong Sell.” This configuration has remained mostly stable over the past three months. On Nov. 6, Baird analyst David Tarantino maintained a "Neutral" rating on MCD and raised the price target from $322 to $325. MCD’s mean price target of $336.87 represents a 12.4% premium to current price levels. Meanwhile, the street-high target of $375 suggests a 25.1% upside potential.
