McDonalds (MCD)

Their decision to extend their $5 meal beyond the summer was applauded by consumers and Wall Street alike as consumers are pushing back against higher prices. Smart.

He added at $250 a month ago. With inflation the lower income population shifted more to eating at home and away from fast food restaurants. McDonalds is now moving to more value priced deals and encouraging people to shift to digital offerings, apps, to increase the use of a loyalty program. McDonalds has a unique business model in that it owns the land that the franchises sit on. 40% of its revenue comes from rent from the franchises.       Buy 28  Hold 13  Sell 0

Consumer staples have been performing under the radar and will continue.

Money is tight for many Americans and even fast food is now considered "discretionary" spending because prices are too high. Nobody expected this, but it's a real now. McDonald's now realizes this and will extend the $5 Meal Deal into September, says the CEO at the Q2 conference call.

Shares fell this year, because many felt its food was too expensive. This morning, they reported disappointing same-store sales, a big sales miss and earnings miss, but shares jumped nearly 4% today. Why? The rally is broadening beyond tech/AI. Also, the street expected MCD's bad numbers, and they introduce $5 Value Meals.

It's tended to be a great when you buy this down (-12% this year). It's such a powerful brand that people can't get enough of it.

Was on her watchlist for a while. Pulled back, down 15% YTD, so she added to client portfolios about a week and a half ago. Global, 100 countries, 41K units. Very profitable business model of 94% franchised. So franchisees pay a royalty percentage of topline sales plus, uniquely, rent for the buildings and land (39% of total revenue). Cashflows are visible and defensible. Yield is 2.63%, dividend increases for 45 consecutive years.

Quick service has lagged due to higher unemployment, diminishing savings, price increases. Renewed focus on value, scale helps them accomplish this.

He trimmed it last January, but wishes he had sold it all. All performance has been driven by price increases, and those days are over. Be careful here.

Shares are down 7% this year. The problem is that their menu prices rose and are too high. They need to cut prices.

His price target is $300. Has owned this for over a decade, a great dividend compounder, but he wouldn't rush into it now.

We live in a country of two consumers: those flush with money and those struggling to buy at dollar stores. MCD reported today and shares fell. Same-store sales grew 4.3% YOY, but felt pressure from the Israel-Hamas war. More pressure came from consumers who are eating at home because packaged foods are more affordable than take-out.

It reports Monday. Almost always, shares rise right after earnings and likely to happen again

Does not own shares, but watching carefully. Demand for products steady and rising. Brand is very strong across the globe. European demand very strong (long lines in stores). A.I. helping company reduce labor inputs. Ability to mesh A.I. with food industry very strong. 

It is adding more stores and raising prices by 10% which people are paying. More middle and higher income people are coming into their restaurants along with lower income customers eating there less often. It has spent 7 years improving the burgers and is now increasing the size of them. It reinvests profits more than the other chains.

It has transformed itself and has bottomed after a sell-off, consolidated and had a nice rally. It is well valued now so wait to buy at $290