McDonald's Corporation operates and franchises McDonald's hamburger-focused restaurants in the United States, Europe, the Asia/Pacific, the Middle East, Africa, Canada, and Latin America. The company was founded in 1940 and is based in Oak Brook, Illinois.
MCD Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for MCD, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Mcdonalds Corp ranked in the 14th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 84.17%. The most interesting components of our discounted cash flow analysis for Mcdonalds Corp ended up being:
The company's compound free cash flow growth rate over the past 5.46 years comes in at -0.03%; that's greater than merely 21.33% of US stocks we're applying DCF forecasting to.
Mcdonalds Corp's weighted average cost of capital (WACC) is 8%; for context, that number is higher than only 16.76% of tickers in our DCF set.
The company's cost of debt, derived from its interest coverage, tax rate, and market capitalization, is greater than only 23.74% of stocks in its sector (Consumer Cyclical).
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Mcdonalds Corp? See NTZ, BBGI, DRI, GOLF, and M.
Wells Fargo thinks McDonald's (MCD) pulled the right levers with the Travis Scott meal and Spicy Nuggets menu addition helping to drive traffic. "MCD's Sept promotions have done quite well (relative to recent months sales and expectations), with the Travis Scott Meal helping the brand connect with an audience that’s...
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