McDonald's Posts Solid Earnings

McDonald’s hasn’t been doing so well recently. Throughout the year, we’ve heard more and more about McDonald’s inability pick up sales. However, the company released results from the third quarter today, exciting investors. Not only did McDonald’s beat earnings and revenue expectations, they proved sales growth. Today, we’ll go over the results from the MCD earnings report, talk about how the market reacted to the news, and discuss what we can expect from the fast food chain moving forward.

McDonald’s Blows Away Earnings And Sales Estimates

As mentioned above, McDonald’s released their earnings report for Q3 today, proving that they have found solutions to their biggest problem. The problem they have been facing is declining sales. However, that doesn’t seem to be a problem anymore. Here are the results from the earnings report the company released today…

  • Sales – This was the biggest concern for investors. However, after today’s report, investors aren’t too concerned about sales anymore. McDonald’s announced that sales in established restaurants gained by 4%. Sales in US restaurants rose by 0.9%. These figures blew away analyst expectations. Analysts expected sales in established restaurants to grow by 1.9% and sales in the United States to grow by 0.2%.
  • Revenue – In terms of revenue, McDonald’s reported totals in Q3 coming to $6.62 billion. In their report, McDonald’s explained that revenues could have been higher, but the strong United States dollar weighed heavy on their revenue. Nonetheless, even though currency values brought revenue down, it was still higher than expectations. Analysts expected revenue to come in at $6.41 billion.
  • Earnings – Finally, earnings came in ahead of expectations. Analysts expected EPS to come in at $1.27 per share. However, in the quarter, MCD reported earnings per share at $1.40. This was a great improvement over last year’s $1.09 per share.

The Solid Report Proves That McDonald’s Is Making The Right Moves

Investors were concerned that McDonald’s wouldn’t be able to pick sales back up. However, the earnings report released today proved the exact opposite. It seems as though the artisan sandwiches, salads and apple wedge option for a side proved to be just what consumers wanted to see. Now, investors and consumers alike are excited to see what’s likely to come next.

What We Can Expect To See Moving Forward

Moving forward, investors are excited about McDonald’s again. The company has proven that it has the ability to generate sales again. With that said, I’ve decided to change my stance on my outlook for McDonald’s. Throughout the year, I have had a bearish opinion with regard to McDonald’s. However, my bearish opinion on the stock had quite a bit to do with sales. While I saw changes, it wasn’t until today that I saw positive results from the changes the company has made. At this point, I’ve got to say that my opinion has become bullish. All in all, through the recent hiccups the company has been through as well as their results in this quarter’s earnings report, McDonald’s has proven that it is capable of getting past some of the toughest problems for fast food restaurants. From here forth, we can expect to see positive movement out of the stock.

What Do You Think?

Where do you think MCD is headed and why? Let us know in the comments below!

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