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McDonald's

NYSE:MCD
Snowflake Description

Established dividend payer with proven track record.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
MCD
NYSE
$148B
Market Cap
  1. Home
  2. US
  3. Consumer Services
Company description

McDonald's Corporation operates and franchises McDonald's restaurants in the United States and internationally. The last earnings update was 41 days ago. More info.


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MCD Share Price and Events
7 Day Returns
0.9%
NYSE:MCD
3.1%
US Hospitality
0.7%
US Market
1 Year Returns
7.5%
NYSE:MCD
18.1%
US Hospitality
21.1%
US Market
MCD Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
McDonald's (MCD) 0.9% 1.6% -5% 7.5% 59.9% 111.5%
US Hospitality 3.1% 5% 4.3% 18.1% 29.7% 33.4%
US Market 0.7% 2.3% 5% 21.1% 37.4% 47.5%
1 Year Return vs Industry and Market
  • MCD underperformed the Hospitality industry which returned 18.1% over the past year.
  • MCD underperformed the Market in United States of America which returned 21.1% over the past year.
Price Volatility
MCD
Industry
5yr Volatility vs Market

MCD Value

 Is McDonald's undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of McDonald's to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for McDonald's.

NYSE:MCD Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 31 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 7.7%
Perpetual Growth Rate 10-Year US Government Bond Rate 1.7%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NYSE:MCD
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 1.7%
Equity Risk Premium S&P Global 5.4%
Hospitality Unlevered Beta Simply Wall St/ S&P Global 0.93
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.931 (1 + (1- 21%) (30.61%))
1.105
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.1
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.74% + (1.105 * 5.44%)
7.75%

Discounted Cash Flow Calculation for NYSE:MCD using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for McDonald's is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

Note: Free cash flow to equity valuations ignore the company's cash or debt.

NYSE:MCD DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 7.75%)
2020 6,085.99 Analyst x7 5,648.28
2021 6,829.00 Analyst x4 5,882.04
2022 7,042.33 Analyst x3 5,629.54
2023 7,218.68 Est @ 2.5% 5,355.49
2024 7,382.89 Est @ 2.27% 5,083.39
2025 7,538.99 Est @ 2.11% 4,817.55
2026 7,689.93 Est @ 2% 4,560.58
2027 7,837.84 Est @ 1.92% 4,314.00
2028 7,984.28 Est @ 1.87% 4,078.54
2029 8,130.39 Est @ 1.83% 3,854.48
Present value of next 10 years cash flows $49,223.00
NYSE:MCD DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= $8,130.39 × (1 + 1.74%) ÷ (7.75% – 1.74%)
$137,650.32
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= $137,650.32 ÷ (1 + 7.75%)10
$65,257.68
NYSE:MCD Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $49,223.00 + $65,257.68
$114,480.68
Equity Value per Share
(USD)
= Total value / Shares Outstanding
= $114,480.68 / 753.09
$152.01
NYSE:MCD Discount to Share Price
Calculation Result
Value per share (USD) From above. $152.01
Current discount Discount to share price of $197.12
= -1 x ($197.12 - $152.01) / $152.01
-29.7%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

  • The current share price of McDonald's is above its future cash flow value.
Often investors are willing to pay a premium for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for McDonald's's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are McDonald's's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NYSE:MCD PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-09-30) in USD $7.69
NYSE:MCD Share Price ** NYSE (2019-12-13) in USD $197.12
United States of America Hospitality Industry PE Ratio Median Figure of 66 Publicly-Listed Hospitality Companies 23.31x
United States of America Market PE Ratio Median Figure of 2,926 Publicly-Listed Companies 18.61x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of McDonald's.

NYSE:MCD PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NYSE:MCD Share Price ÷ EPS (both in USD)

= 197.12 ÷ 7.69

25.63x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • McDonald's is overvalued based on earnings compared to the US Hospitality industry average.
  • McDonald's is overvalued based on earnings compared to the United States of America market.
Price based on expected Growth
Does McDonald's's expected growth come at a high price?
Raw Data
NYSE:MCD PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 25.63x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 31 Analysts
5.4%per year
United States of America Hospitality Industry PEG Ratio Median Figure of 54 Publicly-Listed Hospitality Companies 1.49x
United States of America Market PEG Ratio Median Figure of 2,041 Publicly-Listed Companies 1.5x

*Line of best fit is calculated by linear regression .

NYSE:MCD PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 25.63x ÷ 5.4%

4.73x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • McDonald's is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on McDonald's's assets?
Raw Data
NYSE:MCD PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-09-30) in USD $-11.42
NYSE:MCD Share Price * NYSE (2019-12-13) in USD $197.12
United States of America Hospitality Industry PB Ratio Median Figure of 103 Publicly-Listed Hospitality Companies 2.3x
United States of America Market PB Ratio Median Figure of 5,092 Publicly-Listed Companies 1.79x
NYSE:MCD PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NYSE:MCD Share Price ÷ Book Value per Share (both in USD)

= 197.12 ÷ -11.42

-17.26x

* Primary Listing of McDonald's.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • McDonald's has negative assets, we can't compare the value of its assets to the US Hospitality industry average.
X
Value checks
We assess McDonald's's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Hospitality industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Hospitality industry average (and greater than 0)? (1 check)
  5. McDonald's has a total score of 0/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

MCD Future Performance

 How is McDonald's expected to perform in the next 1 to 3 years based on estimates from 31 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
5.4%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is McDonald's expected to grow at an attractive rate?
  • McDonald's's earnings growth is expected to exceed the low risk savings rate of 1.7%.
Growth vs Market Checks
  • McDonald's's earnings growth is positive but not above the United States of America market average.
  • McDonald's's revenue growth is positive but not above the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NYSE:MCD Future Growth Rates Data Sources
Data Point Source Value (per year)
NYSE:MCD Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 31 Analysts 5.4%
NYSE:MCD Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 31 Analysts 2.9%
United States of America Hospitality Industry Earnings Growth Rate Market Cap Weighted Average 18.9%
United States of America Hospitality Industry Revenue Growth Rate Market Cap Weighted Average 7.2%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 14.2%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7.4%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NYSE:MCD Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 31 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NYSE:MCD Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2022-12-31 22,899 8,864 6,998 4
2021-12-31 22,270 8,385 6,624 12
2020-12-31 21,645 8,076 6,335 31
2019-12-31 21,020 7,993 5,954 31
2019-12-15
NYSE:MCD Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2019-09-30 20,891 7,744 5,869
2019-06-30 20,829 7,929 5,898
2019-03-31 20,842 7,342 5,877
2018-12-31 21,025 6,967 5,924
2018-09-30 21,202 6,564 5,208
2018-06-30 21,588 5,778 5,454
2018-03-31 22,283 5,652 5,353
2017-12-31 22,820 5,551 5,192
2017-09-30 23,509 5,257 5,687
2017-06-30 24,179 5,823 5,079
2017-03-31 24,394 5,858 4,777
2016-12-31 24,622 6,060 4,687

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • McDonald's's earnings are expected to grow by 5.4% yearly, however this is not considered high growth (20% yearly).
  • McDonald's's revenue is expected to grow by 2.9% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NYSE:MCD Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 31 Analyst Estimates (S&P Global) See Below

All data from McDonald's Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:MCD Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2022-12-31 9.97 10.14 9.79 2.00
2021-12-31 9.15 9.28 9.07 5.00
2020-12-31 8.51 8.74 8.35 18.00
2019-12-31 7.76 7.85 7.71 13.00
2019-12-15
NYSE:MCD Past Financials Data
Date (Data in USD Millions) EPS *
2019-09-30 7.69
2019-06-30 7.69
2019-03-31 7.62
2018-12-31 7.61
2018-09-30 6.64
2018-06-30 6.88
2018-03-31 6.69
2017-12-31 6.43
2017-09-30 6.98
2017-06-30 6.16
2017-03-31 5.71
2016-12-31 5.49

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Unable to establish if McDonald's will efficiently use shareholders’ funds in the future without estimates of Return on Equity.
X
Future performance checks
We assess McDonald's's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
McDonald's has a total score of 1/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

MCD Past Performance

  How has McDonald's performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare McDonald's's growth in the last year to its industry (Hospitality).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • McDonald's's year on year earnings growth rate has been positive over the past 5 years.
  • McDonald's's 1-year earnings growth exceeds its 5-year average (12.7% vs 5.9%)
  • McDonald's's earnings growth has exceeded the US Hospitality industry average in the past year (12.7% vs -15.8%).
Earnings and Revenue History
McDonald's's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from McDonald's Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:MCD Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-09-30 20,890.50 5,868.50 2,185.60
2019-06-30 20,829.30 5,897.90 2,157.20
2019-03-31 20,841.90 5,877.30 2,166.20
2018-12-31 21,025.20 5,924.30 2,200.20
2018-09-30 21,202.40 5,207.70 2,208.00
2018-06-30 21,587.60 5,454.10 2,259.80
2018-03-31 22,283.40 5,352.90 2,243.10
2017-12-31 22,820.40 5,192.30 2,231.30
2017-09-30 23,509.10 5,687.00 2,241.20
2017-06-30 24,178.60 5,078.70 2,257.10
2017-03-31 24,393.90 4,776.50 2,327.80
2016-12-31 24,621.90 4,686.50 2,384.50
2016-09-30 24,934.30 4,699.30 2,432.10
2016-06-30 25,125.30 4,733.10 2,433.20
2016-03-31 25,358.00 4,842.60 2,429.50
2015-12-31 25,413.00 4,529.30 2,434.30
2015-09-30 25,643.90 4,420.60 2,421.70
2015-06-30 26,015.90 4,179.80 2,413.50
2015-03-31 26,699.90 4,364.50 2,450.30
2014-12-31 27,441.30 4,757.80 2,487.90
2014-09-30 27,962.30 5,057.30 2,453.20
2014-06-30 28,298.60 5,511.10 2,431.70
2014-03-31 28,200.70 5,520.50 2,409.50
2013-12-31 28,105.70 5,585.90 2,385.60
2013-09-30 27,964.60 5,585.00 2,382.30
2013-06-30 27,793.60 5,517.80 2,448.90
2013-03-31 27,625.70 5,468.30 2,459.20
2012-12-31 27,567.00 5,464.80 2,455.20

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • It is difficult to establish if McDonald's has efficiently used shareholders’ funds last year (Return on Equity greater than 20%) due to its liabilities exceeding its assets.
  • McDonald's used its assets more efficiently than the US Hospitality industry average last year based on Return on Assets.
  • McDonald's's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess McDonald's's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Hospitality industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
McDonald's has a total score of 4/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

MCD Health

 How is McDonald's's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up McDonald's's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • McDonald's's short term (1 year) commitments are greater than its holdings of cash and other short term assets.
  • McDonald's's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of McDonald's's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • McDonald's has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from McDonald's Company Filings, last reported 2 months ago.

NYSE:MCD Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-09-30 -8,599.20 32,850.10 1,177.30
2019-06-30 -6,808.80 32,654.30 1,134.50
2019-03-31 -6,550.90 32,896.70 2,289.10
2018-12-31 -6,258.40 31,087.20 866.00
2018-09-30 -6,792.60 31,923.50 2,574.50
2018-06-30 -5,851.00 31,002.30 1,623.50
2018-03-31 -4,718.80 30,888.00 2,468.00
2017-12-31 -3,268.00 29,542.60 2,463.80
2017-09-30 -3,477.60 28,618.40 2,671.20
2017-06-30 -2,000.60 28,360.80 2,392.40
2017-03-31 -2,030.80 27,207.10 2,412.20
2016-12-31 -2,204.30 25,957.30 1,224.40
2016-09-30 -1,624.10 26,007.00 2,266.70
2016-06-30 640.00 26,010.00 3,128.00
2016-03-31 3,863.00 23,352.60 3,310.10
2015-12-31 7,087.90 24,125.50 7,685.50
2015-09-30 8,309.80 17,990.50 2,452.50
2015-06-30 10,560.90 17,901.60 3,998.50
2015-03-31 11,403.30 14,291.80 1,634.80
2014-12-31 12,853.40 14,943.20 2,080.50
2014-09-30 13,625.90 15,130.20 3,233.30
2014-06-30 16,154.90 15,430.60 3,670.60
2014-03-31 16,147.70 13,926.80 2,743.80
2013-12-31 16,009.70 14,141.80 2,798.70
2013-09-30 15,164.90 13,487.80 2,544.30
2013-06-30 15,170.70 13,369.80 2,278.40
2013-03-31 15,228.20 12,797.90 1,869.30
2012-12-31 15,293.60 13,632.50 2,340.30
  • McDonald's has negative shareholder equity (liabilities exceed assets), this is a more serious situation compared with a high debt level.
  • Irrelevant to check if McDonald's's debt level has increased considering it has negative shareholder equity.
  • Debt is well covered by operating cash flow (23.6%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 8.2x coverage).
X
Financial health checks
We assess McDonald's's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. McDonald's has a total score of 2/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

MCD Dividends

 What is McDonald's's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
2.54%
Current annual income from McDonald's dividends. Estimated to be 2.54% next year.
If you bought $2,000 of McDonald's shares you are expected to receive $51 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • McDonald's's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.43%).
  • McDonald's's dividend is below the markets top 25% of dividend payers in United States of America (3.71%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NYSE:MCD Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 31 Analyst Estimates (S&P Global) See Below
United States of America Hospitality Industry Average Dividend Yield Market Cap Weighted Average of 44 Stocks 3%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 1964 Stocks 2.3%
United States of America Minimum Threshold Dividend Yield 10th Percentile 0.8%
United States of America Bottom 25% Dividend Yield 25th Percentile 1.4%
United States of America Top 25% Dividend Yield 75th Percentile 3.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NYSE:MCD Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2022-12-31 5.60 2.00
2021-12-31 5.33 8.00
2020-12-31 5.04 14.00
2019-12-31 4.70 14.00
2019-12-15
NYSE:MCD Past Annualized Dividends Data
Date (Data in $) Dividend per share (annual) Avg. Yield (%)
2019-09-19 5.000 2.499
2019-07-18 4.640 2.155
2019-05-23 4.640 2.257
2019-05-08 4.640 2.331
2019-04-30 4.640 2.356
2018-09-20 4.640 2.576
2018-07-19 4.040 2.526
2018-05-24 4.040 2.505
2018-01-30 4.040 2.515
2017-09-21 4.040 2.400
2017-07-27 3.760 2.385
2017-05-24 3.760 2.455
2017-01-26 3.760 2.849
2016-09-29 3.760 3.190
2016-07-28 3.560 3.052
2016-05-26 3.560 2.914
2016-01-27 3.560 2.882
2015-11-10 3.560 3.067
2015-07-16 3.400 3.380
2015-05-21 3.400 3.524
2015-01-28 3.400 3.523
2014-09-18 3.400 3.645
2014-07-17 3.240 3.437
2014-05-22 3.240 3.204
2014-01-29 3.240 3.310
2013-09-18 3.240 3.374
2013-07-18 3.080 3.178
2013-05-23 3.080 3.109
2013-01-30 3.080 3.119
2013-01-23 3.080 3.274
2012-11-01 3.080 3.485
2012-10-19 3.080 3.520
2012-07-19 2.800 3.097
2012-05-24 2.800 3.135
2012-01-26 2.800 2.887
2011-09-22 2.800 2.970
2011-07-22 2.440 2.793
2011-05-19 2.440 2.930
2011-01-27 2.440 3.195
2010-09-23 2.440 3.174
2010-05-20 2.200 3.116
2010-01-22 2.200 3.296
2009-09-24 2.200 3.613
2009-07-23 2.000 3.587
2009-05-27 2.000 3.452
2009-01-22 2.000 3.636

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Dividends per share have been stable in the past 10 years.
  • Dividends per share have increased over the past 10 years.
Current Payout to shareholders
What portion of McDonald's's earnings are paid to the shareholders as a dividend.
  • Dividends paid are covered by earnings (1.7x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be covered by earnings (1.8x coverage).
X
Income/ dividend checks
We assess McDonald's's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 0.8%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can McDonald's afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. McDonald's has a total score of 5/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

MCD Management

 What is the CEO of McDonald's's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Chris Kempczinski
COMPENSATION $4,678,340
AGE 50
TENURE AS CEO 0.1 years
CEO Bio

Mr. Christopher J. Kempczinski, also known as Chris, is the President, CEO and Director at McDonald's Corporation since November 1, 2019. He served as President of USA at McDonald's Corporation since January 1, 2017. Mr. Kempczinski served as President at McDonald's USA, LLC since January 01, 2017. He served as Executive Vice President of Strategy, Business Development & Innovation at McDonald's Corporation since October 26, 2015 until December 2016. Mr. Kempczinski oversaw all aspects of strategy development, planning, innovation and new concepts to drive growth for the company. Mr. Kempczinski served as the President of International and Executive Vice President of Growth Initiatives at Kraft Foods Group, Inc., since February 12, 2015 until September 2015. Mr. Kempczinski served as the President of Kraft Canada Inc since July 2012 until December 2014 and served as Senior Vice President - U.S. Grocery from December 2008 to July 2012. He served as an Executive Vice President at Kraft Foods Group, Inc since January 29, 2014 until February 2015. He leads Kraft’s Canadian business unit overseeing all aspects of supply chain, sales, marketing, human resources and research, development and quality. He has full P&L responsibility for the business including beloved brands such as Kraft Dinner, Kraft Peanut Butter, Cracker Barrel natural cheeses and Nabob coffee. During his time with Kraft Canada, Mr. Kempczinski has led the business unit through transformative change with the separation from Mondelez International in October 2012 and later restructuring the organization’s resources to focus on simplification and innovation. Mr. Kempczinski joined Kraft in 2008 as Senior Vice President overseeing brands in the meals and enhancers categories with iconic brands like Kraft Macaroni & Cheese and Kraft dressings. Prior to joining Kraft, he served as Vice President of Marketing in the non-carbonated beverages sector of PepsiCo. Before PepsiCo, he was a Management Consultant at The Boston Consulting Group, focusing predominantly on consumer products and pharmaceuticals. He spent the first four years of his career as a brand manager at Procter & Gamble. He has received numerous marketing awards including 4 Cannes Lions, 2 Emmy nominations and multiple Effie and Clio awards. For his marketing accomplishments, he was inducted into the American Advertising Federation’s Hall of Achievement. Mr. Kempczinski received his B.A. in Economics from Duke University and his MBA from the Harvard Business School. Mr. Kempczinski has been with McDonald's Corporation for over 2 years.

CEO Compensation
  • Chris's compensation has increased by more than 20% in the past year whilst earnings grew less than 20%.
  • Chris's remuneration is lower than average for companies of similar size in United States of America.
Management Team Tenure

Average tenure and age of the McDonald's management team in years:

3
Average Tenure
52
Average Age
  • The tenure for the McDonald's management team is about average.
Management Team

Chris Kempczinski

TITLE
President
COMPENSATION
$5M
AGE
50
TENURE
0.1 yrs

Kevin Ozan

TITLE
Corporate Executive VP & CFO
COMPENSATION
$5M
AGE
56
TENURE
4.8 yrs

Joe Erlinger

TITLE
President of McDonald's USA
COMPENSATION
$4M
AGE
45
TENURE
0.1 yrs

Catherine Hoovel

TITLE
Corporate VP & Chief Accounting Officer
AGE
48
TENURE
3.2 yrs

Daniel Henry

TITLE
Corporate Executive VP & Chief Information Officer
AGE
48
TENURE
2.2 yrs

Mike Flores

TITLE
Senior VP & Investor Relations Officer

Jerome Krulewitch

TITLE
Corporate Executive VP
AGE
54
TENURE
2.8 yrs

Silvia Lagnado

TITLE
Corporate Executive VP & Global Chief Marketing Officer
COMPENSATION
$4M
AGE
55
TENURE
4.3 yrs

Radek Janalik

TITLE
Managing Director of McDonald's Hungary

Sarah Casanova

TITLE
MD of Mcdonald’s Malaysia & Regional Manager of Mcdonald’s Singapore and Malaysia
AGE
54
TENURE
7.5 yrs
Board of Directors Tenure

Average tenure and age of the McDonald's board of directors in years:

7.8
Average Tenure
63.5
Average Age
  • The tenure for the McDonald's board of directors is about average.
Board of Directors

Rick Hernandez

TITLE
Non-Executive Chairman of the Board
COMPENSATION
$777K
AGE
63
TENURE
3.6 yrs

Chris Kempczinski

TITLE
President
COMPENSATION
$5M
AGE
50
TENURE
0.1 yrs

Andrew McKenna

TITLE
Chairman Emeritus
COMPENSATION
$156K
AGE
90
TENURE
3.6 yrs

Miles White

TITLE
Independent Director
COMPENSATION
$311K
AGE
64
TENURE
10.7 yrs

John Mulligan

TITLE
Independent Director
COMPENSATION
$326K
AGE
53
TENURE
4.3 yrs

Robert Eckert

TITLE
Independent Director
COMPENSATION
$321K
AGE
65
TENURE
16.9 yrs

John Rogers

TITLE
Independent Director
COMPENSATION
$286K
AGE
60
TENURE
16.9 yrs

Rick Lenny

TITLE
Independent Director
COMPENSATION
$296K
AGE
67
TENURE
14.3 yrs

Sheila Penrose

TITLE
Independent Director
COMPENSATION
$321K
AGE
73
TENURE
13.6 yrs

Margo Georgiadis

TITLE
Independent Director
COMPENSATION
$286K
AGE
55
TENURE
4.9 yrs
Who owns this company?
Recent Insider Trading
  • More shares have been bought than sold by McDonald's individual insiders in the past 3 months.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price ($) Value ($)
18. Nov 19 Buy John Rogers Individual 14. Nov 19 14. Nov 19 1,000 $194.12 $194,120
12. Nov 19 Buy Enrique Hernandez Individual 07. Nov 19 07. Nov 19 2,500 $193.83 $484,575
07. Nov 19 Buy John Mulligan Individual 06. Nov 19 06. Nov 19 1,300 $193.46 $251,498
06. Nov 19 Buy Christopher Kempczinski Individual 06. Nov 19 06. Nov 19 2,580 $193.81 $500,030
03. May 19 Sell Christopher Kempczinski Individual 03. May 19 03. May 19 -10,854 $195.21 $-2,118,809
03. May 19 Sell Jerome Krulewitch Individual 01. May 19 01. May 19 -2,257 $195.54 $-441,334
03. May 19 Sell Kevin Ozan Individual 01. May 19 01. May 19 -10,000 $195.92 $-1,959,200
25. Feb 19 Sell Catherine Hoovel Individual 15. Feb 19 15. Feb 19 -280 $178.60 $-50,008
07. Feb 19 Sell Daniel Henry Individual 06. Feb 19 06. Feb 19 -3,036 $177.13 $-537,767
04. Feb 19 Sell Andrew McKenna Individual 31. Jan 19 31. Jan 19 -30,000 $180.27 $-5,408,100
X
Management checks
We assess McDonald's's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. McDonald's has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

MCD News

Simply Wall St News

Does McDonald's (NYSE:MCD) Deserve A Spot On Your Watchlist?

See our latest analysis for McDonald's How Fast Is McDonald's Growing? … Since McDonald's has a market capitalization of US$165b, we wouldn't expect insiders to hold a large percentage of shares. … But if you prefer to focus on stocks that have demonstrated insider buying, here is a list of companies with insider buying in the last three months.

Simply Wall St -

McDonald's Corporation (NYSE:MCD) Is About To Go Ex-Dividend, And It Pays A 0.5% Yield

Stocks in companies that generate sustainable earnings growth often make the best dividend prospects, as it is easier to lift the dividend when earnings are rising. … Decent historical earnings per share growth suggests McDonald's has been effectively growing value for shareholders. … Earnings per share have been growing modestly and McDonald's paid out a bit over half of its earnings and free cash flow last year.

Simply Wall St -

McDonald's Corporation (NYSE:MCD): What Are The Future Prospects?

Below is a brief commentary on the longer term outlook the market has for McDonald's. … To get an idea of the overall earnings growth trend for MCD, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line. … NYSE:MCD Past and Future Earnings, August 21st 2019 By 2022, MCD's earnings should reach US$7.1b, from current levels of US$5.9b, resulting in an annual growth rate of 5.9%.

Simply Wall St -

Can We See Significant Institutional Ownership On The McDonald's Corporation (NYSE:MCD) Share Register?

Our analysis of the ownership of the company, below, shows that institutions own shares in the company. … See our latest analysis for McDonald's NYSE:MCD Ownership Summary, August 12th 2019 What Does The Institutional Ownership Tell Us About McDonald's? … We can see that McDonald's does have institutional investors; and they hold 71% of the stock.

Simply Wall St -

How Does McDonald's Corporation (NYSE:MCD) Fare As A Dividend Stock?

Click the interactive chart for our full dividend analysis NYSE:MCD Historical Dividend Yield, August 2nd 2019 Payout ratios Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. Looking at the data, we can see that 58% of McDonald's's profits were paid out as dividends in the last 12 months. This is a healthy payout ratio, and while it does limit the amount of earnings that can be reinvested in the business, there is also some room to lift the payout ratio over time. Another important check we do is to see if the free cash flow generated is sufficient to pay the dividend. The company paid out 70% of its free cash flow, which is not bad per se, but does start to limit the amount of cash McDonald's has available to meet other needs. It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously. Is McDonald's's Balance Sheet Risky? As McDonald's has a meaningful amount of debt, we need to check its balance sheet to see if the company might have debt risks. A rough way to check this is with these two simple ratios: a) net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and b) net interest cover. … Second, it has a limited history of earnings per share growth, but at least the dividends have been relatively stable. … Earnings growth generally bodes well for the future value of company dividend payments.

Simply Wall St -

Here's Why McDonald's (NYSE:MCD) Can Manage Its Debt Responsibly

The first step when considering a company's debt levels is to consider its cash and debt together. … NYSE:MCD Historical Debt, July 22nd 2019 How Healthy Is McDonald's's Balance Sheet? … When analysing debt levels, the balance sheet is the obvious place to start.

Simply Wall St -

Read This Before Buying McDonald's Corporation (NYSE:MCD) Shares

As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.' View our latest analysis for McDonald's The Last 12 Months Of Insider Transactions At McDonald's Over the last year, we can see that the biggest insider sale was by the Chairman Emeritus, Andrew McKenna, for US$5.4m worth of shares, at about US$180 per share. … NYSE:MCD Recent Insider Trading, July 12th 2019 McDonald's Insiders Are Selling The Stock The last quarter saw substantial insider selling of McDonald's shares. … Insiders haven't bought McDonald's stock in the last three months, but there was some selling.

Simply Wall St -

How McDonald's Corporation (NYSE:MCD) Could Add Value To Your Portfolio

By this I mean, I look at stocks holistically, from their financial health to their future outlook. … NYSE:MCD Historical Dividend Yield, July 1st 2019 Next Steps: For McDonald's, I've put together three key aspects you should further research: Future Outlook: What are well-informed industry analysts predicting for MCD’s future growth? … Take a look at our free research report of analyst consensus for MCD’s outlook.

Simply Wall St -

Does McDonald's Corporation's (NYSE:MCD) CEO Pay Reflect Performance?

According to our data, McDonald's Corporation has a market capitalization of US$157b, and pays its CEO total annual compensation worth US$16m. … We took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO total compensation to be US$11m. … Thus we can conclude that Steve Easterbrook receives more in total compensation than the median of a group of large companies in the same market as McDonald's Corporation.

Simply Wall St -

Is McDonald's Corporation's (NYSE:MCD) High P/E Ratio A Problem For Investors?

The formula for P/E is: Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS) Or for McDonald's: P/E of 26.21 = $199.63 ÷ $7.62 (Based on the trailing twelve months to March 2019.) Is A High P/E Ratio Good? … A higher P/E ratio means that buyers have to pay a higher price for each $1 the company has earned over the last year. … While the company does use modest debt, its recent earnings growth is very good.

Simply Wall St -

MCD Company Info

Description

McDonald's Corporation operates and franchises McDonald's restaurants in the United States and internationally. Its restaurants offer various food products, soft drinks, coffee, and other beverages, as well as breakfast menu. As of March 31, 2019, the company operated 37,971 restaurants, including 35,278 franchised restaurants. McDonald's Corporation was founded in 1940 and is based in Chicago, Illinois.

Details
Name: McDonald's Corporation
MCD
Exchange: NYSE
Founded: 1940
$148,449,756,421
753,093,326
Website: http://corporate.mcdonalds.com
Address: McDonald's Corporation
110 North Carpenter Street,
Chicago,
Illinois, 60607,
United States
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NYSE MCD Common Stock New York Stock Exchange US USD 02. Jan 1968
DB MDO Common Stock Deutsche Boerse AG DE EUR 02. Jan 1968
XTRA MDO Common Stock XETRA Trading Platform DE EUR 02. Jan 1968
SWX MCD Common Stock SIX Swiss Exchange CH CHF 02. Jan 1968
WBAG MCD Common Stock Wiener Boerse AG AT EUR 02. Jan 1968
SNSE MCD Common Stock Santiago Stock Exchange CL USD 02. Jan 1968
BVC MCD Common Stock Bolsa de Valores de Colombia CO COP 02. Jan 1968
BMV MCD * Common Stock Bolsa Mexicana de Valores MX MXN 02. Jan 1968
ETLX MD-U Common Stock Eurotlx IT EUR 02. Jan 1968
BOVESPA MCDC34 BDR REPR 1/4 COM USD0.01 Bolsa de Valores de Sao Paulo BR BRL 29. Dec 2011
BASE MCD CEDEAR (4 REP 1 USD0.01) Buenos Aires Stock Exchange AR ARS 24. Jan 2000
Number of employees
Current staff
Staff numbers
210,000
McDonald's employees.
Industry
Restaurants
Consumer Services
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/12/15 23:41
End of day share price update: 2019/12/13 00:00
Last estimates confirmation: 2019/12/12
Last earnings filing: 2019/11/04
Last earnings reported: 2019/09/30
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.