#3 - McDonald’s (NYSE:MCD)
Some investors avoid consumer discretionary stocks, like restaurants, in a bear market. The belief is that as consumers begin to tighten their belts, they’ll eat at home more. McDonald’s (NYSE:MCD) punched a hole in that theory during the pandemic and continues to deliver strong revenue and earnings even as inflation rises and the outlook for the economy becomes more pessimistic.
The reason for these strong results comes from McDonald’s investing in its digital business before the pandemic. That investment is paying dividends (no pun intended). The company is operating with in-store kiosks and mobile ordering that complements a brisk and increasingly efficient drive-thru business. An expectation of strong consumer demand should allow MCD stock to support a somewhat lofty valuation.
The company’s dividend currently pays out $5.52 per share on an annual basis and is growing at an annual rate of around 7.8%. With earnings growing at a steady pace, investors can count on a growing dividend for years to come.
About McDonald's
McDonald's Corp. engages in the operation and franchising of restaurants. It operates through the following segments: U.S., International Operated Markets, and International Developmental Licensed Markets and Corporate. The U.S. segment focuses its operations on the United States. The International Operated Markets segment consists of operations and the franchising of restaurants in Australia, Canada, France, Germany, Italy, the Netherlands, Spain, and the U.K.
More- Current Price
- $304.76
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 16 Buy Ratings, 10 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $323.61 (6.2% Upside)
