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Wednesday, January 19, 2022

Will McDonald’s Corporation (MCD) Pop Or Drop After Earnings?

McDonald’s Corporation (MCD) suffered a loss in Thursday’s trading after the fast-food chain’s Q4 financials were revealed. There has been a significant increase in COVID-19 cases worldwide and related government restrictions, which has had a detrimental effect on McDonald’s sales, especially in regions with fewer McDrive stores and are more dependent on digital sales.

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In the fourth quarter, McDonald’s key figures were lower than in the previous quarter. McDonald’s reported a 14% decline in earnings per share (from last year) to $1.70, below analysts’ expectations of $1.78. A year earlier, the company’s quarterly profit was $1.57 billion, but it fell to $1.38 billion last quarter. A higher $30 million loss was attributed to higher restaurant closing costs and lower profit margins.

The McDonald’s holiday quarter revenue fell by 1% on both an annualized basis and over a year-over-year basis to $5.31 billion, which was also below analysts’ forecast of $5.37 billion. Global comparable sales declined by 1.3% at McDonald’s in the fourth quarter. The company’s US sales grew by 5.5%, as it has about 14,000 restaurants, many McDrive locations, and a fast-growing in-app sales channel.

McDonald’s Corporation (MCD) sales decreased by 7.4% and 3.6%, respectively, in the international management and international development licensing segments. Most of the sales dropped in France, Germany, Italy, and Spain, where the governments heavily impose social restrictions. However, sales in Australia and the UK were positive throughout the quarter. The McDonald’s chain saw its sales increase, both digitally and through checks.

The company’s total revenues for 2020 decreased by 10% from $ 21.36 billion to $ 19.2 billion, and profits by 21% from $6 billion19.2 billion. McDonald’s management anticipates that global sales will grow in 2021, staying above the indicator in 2019, but no specific numbers were provided.

Turning now to MCD’s past performance, we will observe different moving trends. McDonald’s Corporation (MCD) fell -3.14% for the past week and fell -3.36% over the last three months. In the last quarter, shares of this organization’s stock fell -7.24%. The stock has increased by 5.41% in the last six months, with a full-year loss of -3.55%. This stock is currently trading at a -3.62% negative YTD price performance.

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