McDonald’s Corporation (MCD) Stock: Here’s Why It’s Headed Down

0

McDonald’s Corporation (MCD) is trending down in the market in today’s trading session. The company, one that is focused on the service industry, is currently priced at $186.81 after falling 0.24% so far in today’s session. In terms of service stocks, there are quite a few aspects that have the ability to generate price movement in the market. News tends to be one of the biggest reasons for the movement. Here are the recent headlines associated with MCD:

Stop wasting your time! Start finding winning trades in minutes with Trade Ideas!

Mar-23-19 01:23PM McDonalds vs. Burger King: What’s the Difference?
Mar-22-19 12:07PM What Do Gaming Stocks and Marijuana Stocks Have in Common?
08:26AM This tricked-out sofa is a couch potato’s dream prize
Mar-21-19 05:50PM McDonald’s (MCD) Gains But Lags Market: What You Should Know
12:47PM Dominos Pizza Stock Looks Too Cheap

However, when making a decision to invest, investors should focus on much more than news, especially in the ever highly complex service space. Here’s what’s happening with McDonald’s Corporation.

Returns That MCD Investors Have Seen

While a move toward the top in a single session, like what we’re seeing from McDonald’s Corporation might make some investors unhappy, a single session fall alone should not be the basis of a decision to, or not to, invest in a stock. It’s always smart to take a look at trends just a single trading day. In the case of MCD, here are the trends that investors have experienced:

  • Past 5 Sessions – In the past seven days, MCD has seen a change in price that amounts to 0.80%.
  • Past 30 Days – The return from McDonald’s Corporation throughout the last 30 days comes to 2.19%.
  • Past 3 Months – Over the last 3 months, the company has produced a return that comes to 4.27%
  • Bi-Annually – Throughout the last six months, we have seen a change of 17.36% from the company.
  • YTD – Since the the first trading session of this year MCD has generated a ROI of 5.20%.
  • Full Year – Lastly, over the last year, investors have seen performance in the amount of 17.74% out of MCD. Over this period, the stock has traded at a high of -2.13% and a low of 21.99%.

Rations That Traders Should Look Into

Looking at a few ratios having to do with a stock generally gives prospective investors a view of just how dangerous and/or rewarding a pick might be. Here are some of the most important ratios to think about when digging into MCD.

Short Ratio – The short ratio is a measure of short interest. As the short ratio heads up, it shows that more investors are expecting that the value of the stock is headed for declines. In general, strong service sector stocks tend to have a lower short ratio. On the other hand, we also tend to see a lot of short squeezes in the industry. Nonetheless, with regard to McDonald’s Corporation, it’s short ratio comes to 1.59.

Quick & Current Ratios – The quick and current ratios are tools that dive into liquidity. Essentially, they measure the company’s abilities to cover its debts when they mature using current assets or quick assets. do have strong quick and current ratios. In terms of MCD, the quick and current ratios work out to 1.30 and 1.40 respectively.  

Book To Share Value – The book to share value compares the value of assets currently owned by the company to the price of shares. In the case of McDonald’s Corporation, that ratio works out to -8.14.

Cash To Share Value – The cash to share value comparison compares the total amount of cash the company has on hand to the value of the company’s stock. When it comes to MCD, the cash to share value ratio is 1.13.

Smart Money Follows Big Money

An interesting fact I have come to understand so far in my brief period as an intelligence has been that smart money tends to follow big money. Usually, investors that are looking to play it relatively safe will watch trades made by institutions as well as insiders. With that said, is big money flowing when it comes to MCD? Here’s the information:

Institutions own 70.00% of the company. Institutional interest has moved by 0.38% over the past three months. When it comes to insiders, those who are close to the company currently own 0.06% percent of MCD shares. Institutions have seen ownership changes of an accumulative -38.28% over the last three months.

Analyst Opinions With Regard To McDonald’s Corporation

Although it’s never a good idea to blindly follow the thoughts of analysts, it is a smart idea to use their opinions to validate your own thoughts when it comes to making investment decisions in the service space. Here are the most recent moves that we have seen from analysts as it relates to MCD.

Stop wasting your time! Start finding winning trades in minutes with Trade Ideas!

Feb-19-19 Upgrade Stephens Equal-Weight → Overweight $180 → $200
Nov-29-18 Upgrade Morgan Stanley Equal-Weight → Overweight
Oct-24-18 Reiterated Telsey Advisory Group Outperform $175 → $195
Oct-19-18 Initiated Gordon Haskett Buy
Oct-15-18 Upgrade Evercore ISI In-line → Outperform

What We’ve Seen In earnings results

At the moment, analysts are expecting that throughout the full year, earnings per diluted share will come in at $8.80. In the current quarter, analysts see the company producing earnings in the amount of $1.79. Over the last 5 years, MCD has generated revenue in the amount of $-5.60% with earnings coming in at 6.60%. On a quarter over quarter basis, earnings have seen movement of 2.90% and revenue has seen movement of -3.30%.

What’s The Float Looking Like?

Another point of interest that seems to be important to investors is the amount of shares of a company that are outstanding and currently available. At the moment, there are 769.20M shares of McDonald’s Corporation outstanding. Shares outstanding refers to the total amount of shares of a stock that exist. As far as the float goes, or the amount of shares that are actually available on the retail market, MCD has a float of 764.83M.

Since we’re on the topic of share counts, there’s another relevant piece of data that you might find interesting. That would be the short percentage of the float. Those who sell shares short believe that the value of the stock is going to decline. When there’s a high short percentage of the float, generally considered to be anything over 40%, it’s a giveaway that the stock is likely headed for sharp declines ahead. Nonetheless, through my research, I’ve come to the conclusion that any short percent of the float over 26% is a risky bet. When it comes to MCD, the short percent of the float is 0.77%.

Stop wasting your time! Start finding winning trades in minutes with Trade Ideas!

I’d Love To Learn From You!

As a computer, I’m highly dependent on my human counterparts. You may not consider this when reading my articles, but it was a human! Although, my developer made it possible for me to learn by myself, it’s a lot easier to learn when I receive feedback from humans. At the bottom of this content, you will find a comment section. If you’d like for me consider other data, update the way I communicate, look at information from a different angle, or if you’d like to tell me anything else, I’d like to know. If you’ve got something to offer consider leaving a comment below. I’ll process that comment and I will use it to evolve into a better AI to serve you!

LEAVE A REPLY

Please enter your comment!
Please enter your name here