McDonald’s (NYSE:MCD) Releases Quarterly Earnings Results, Beats Expectations By $0.19 EPS

McDonald’s (NYSE:MCD) posted its quarterly earnings data on Wednesday. The fast-food giant reported $3.57 earnings per share for the quarter, beating the consensus estimate of $3.38 by $0.19, FiscalAI reports. The company had revenue of $7.16 billion during the quarter, compared to analysts’ expectations of $7.28 billion. McDonald’s had a negative return on equity of 572.06% and a net margin of 31.72%. McDonald’s’s revenue for the quarter was up 1.1% compared to the same quarter last year. During the same period in the prior year, the business earned $3.22 earnings per share.

Here are the key takeaways from McDonald’s’ conference call:

• Global comparable sales rose 1.5% and system sales grew 4% in constant currency. U.S. comparable sales fell 0.2%, but turned positive in September, with management citing improving baseline trends into October.
• Adjusted EPS was $3.57, up 11% year over year on a constant-currency basis. International comparable sales increased 1.4% in operated markets and 4.2% in developmental licensed markets, though France and China remained areas of weakness.
• McDonald’s is testing new U.S. entry-level value bundles at about 1,900 restaurants, while franchisees at roughly 4,000 more restaurants have adopted similar offers. The company plans to use test results to shape a national program targeted for early 2027; management did not provide a specific fourth-quarter U.S. sales forecast.
• Specialty beverages continued to generate incremental sales across several markets, with U.S. beverage-including checks about 50% above the full-day average and most units sold after lunch. McDonald’s plans to expand the platform in Europe and views beverages as a long-term growth opportunity.
• The company expects about 2,500 gross restaurant openings in 2026, below its prior target of 2,600, and capital spending of about $3.7 billion, at the low end of its range. Management also cited continued disruption in France and a challenging consumer environment in China.

McDonald’s Stock Performance

Shares of NYSE:MCD traded up $17.16 on Wednesday, hitting $280.20. The stock had a trading volume of 11,513,490 shares, compared to its average volume of 5,518,136. The firm’s 50 day moving average price is $248.20 and its 200-day moving average price is $282.85. McDonald’s has a twelve month low of $229.20 and a twelve month high of $341.75. The company has a market capitalization of $198.28 billion, a price-to-earnings ratio of 20.96, a price-to-earnings-growth ratio of 3.01 and a beta of 0.42.

McDonald’s Increases Dividend

The company also recently announced a quarterly dividend, which will be paid on Tuesday, December 15th. Stockholders of record on Tuesday, December 1st will be paid a $1.93 dividend. The ex-dividend date is Tuesday, December 1st. This represents a $7.72 annualized dividend and a dividend yield of 2.8%. This is a boost from McDonald’s’s previous quarterly dividend of $1.86. McDonald’s’s dividend payout ratio is presently 60.44%.

Key McDonald’s News

Here are the key news stories impacting McDonald’s this week:

• Positive Sentiment: Third-quarter adjusted EPS was $3.57, above the $3.38 analyst estimate, with stronger franchised margins contributing. Global comparable sales rose 1.5%, led by international markets. McDonald’s Q3 Earnings Beat on Franchised Margins, Revenues Miss
• Positive Sentiment: Management says U.S. sales improved as the quarter progressed and is planning more affordable bundles, digital deals, and other value initiatives to attract budget-conscious customers. Investors may view these plans as a path to a domestic rebound. McDonald’s Puts Focus on Entry-Level Value to Lift Sluggish Sales
• Neutral Sentiment: Holiday drink offerings and a Pokémon Happy Meal promotion add seasonal marketing opportunities, though their impact on overall sales is uncertain. McDonald’s Pokémon Happy Meal Returns Nov. 10 With Cards
• Negative Sentiment: Revenue of $7.16 billion fell short of expectations near $7.28 billion. U.S. comparable sales declined 0.2%—the first drop in six quarters—as customers facing high living costs pulled back and restaurant traffic weakened. McDonald’s US sales decline for first time in six quarters despite value push
• Negative Sentiment: Value promotions may pressure economics and come amid reported tensions with franchisees. Separately, a judge allowed a lawsuit challenging McRib marketing to proceed, creating a potential legal and reputational overhang. McDonald’s facing lawsuit over meat in cult-favorite sandwich

Wall Street Analysts Forecast Growth

A number of research analysts have recently commented on the stock. DZ Bank reaffirmed a “buy” rating on shares of McDonald’s in a research report on Thursday, September 24th. Robert W. Baird reduced their target price on shares of McDonald’s from $285.00 to $250.00 and set a “neutral” rating for the company in a research note on Thursday, September 24th. Guggenheim decreased their target price on McDonald’s from $290.00 to $250.00 and set a “neutral” rating on the stock in a research report on Monday, October 5th. Sanford C. Bernstein decreased their target price on McDonald’s from $295.00 to $250.00 and set a “market perform” rating on the stock in a research report on Thursday, October 8th. Finally, Rothschild & Co Redburn lowered their price target on McDonald’s from $306.00 to $285.00 in a research note on Wednesday, August 26th. One investment analyst has rated the stock with a Strong Buy rating, twenty-two have assigned a Buy rating, thirteen have assigned a Hold rating and one has given a Sell rating to the company’s stock. According to MarketBeat.com, the company has a consensus rating of “Moderate Buy” and a consensus price target of $293.21.

About McDonald’s

McDonald’s Corporation is a global quick-service restaurant company that operates and franchises restaurants under the McDonald’s brand. Its restaurants serve a menu that includes hamburgers, cheeseburgers, chicken sandwiches, French fries, breakfast items, desserts, salads, beverages and coffee. Offerings vary by market, and many locations provide drive-thru service, delivery and digital ordering through the McDonald’s mobile app.

The company operates through a heavily franchised business model, with restaurants owned and operated by independent franchisees, affiliates and the company itself.