McDonald Stock Stay Strong Amidst Economic Instability
Under Easterbrook leadership the company has performed quite better and the future looks great for the company too.
The recent economic crux has warned all the investors and analysts about the probable recession which might hit the companies across the world hard. Such forecasts led the investors to make prudent investments. Investors then generally prefer buying the stock which has higher immunity against the impending whirlpool of economic instability. One of such stocks is McDonald’s Corporation’s. The fast-food restaurant’s stock has been soaring up thanks to the competent and strategic leadership of Stephen Easterbrook. Moreover, the company posted higher than expected earnings in the last quarter.
Not a very long time back, the largest fast-food chain was facing difficulty in keeping its stock away from plummeting down. However, Easterbrook’s turnaround plans help the company to insulate itself from recession effects. The main reason of the company’s good performance is the several changes made in the menu by the CEO. The clear results will likely be seen in this year. Among the “comeback plans” the CEO transformed many of the fast food restaurants’ interior lay out and it also introduced “Pick 2 for $2” option. He also worked on improving the quality of the ingredients by bringing cage-free eggs instead of antibiotic-treated chicken.
Easterbrook also challenged his leadership when he introduced the All Day Breakfast Menu. It was hard to get a breakfast menu running throughout the day. The efforts bore fruit for the company and the decision increased the sales and attracted a lot of customers. NPD Group Inc. showed in a study that more than 30% of the people who benefitted from the improved timing of the menu hadn’t been coming to the restaurant after the traditional breakfast hours –up to 10.30 am –when the McMuffins were not served.
The figures from the study showed that the extension in the hours for the breakfast menu did help McDonald’s to bring in a lot of new customers instead of just persuading the existing shoppers to buy menu items at a cheaper rate which is what many analysts had anticipated.
McDonald’s fourth-quarter results revealed that company’s strategies are producing better results. The growth of the same-store sales was reported to increase by 5.7%. Moreover, the U.S. based company outperformed the expectations and posted bolstering revenue of $6.34 billion with $1.31 per share.
Undoubtedly, in the foregoing year, the company transitioned a lot. The stockholders currently enjoy around 3% dividend yield and analyst expect that in the coming years, the dividend might increase. The company has been increasing its dividend payment each year and in the future it is expected to do so. Therefore, MCD stock is safe to acquire as it is likely to payout divided despite economic uncertainty. At the market which closed on Wednesday, $117.49.