BMO raises McDonald’s stock price target to $340, keeps Outperform

On Tuesday, BMO Capital Markets increased its price target on McDonald’s Corporation (NYSE:MCD) shares from $335.00 to $340.00, while reiterating an Outperform rating on the stock. The adjustment follows the company’s fourth-quarter earnings report, where McDonald’s posted earnings per share (EPS) of $2.83, narrowly missing the consensus estimate of $2.85. The slight shortfall was attributed to lower company margins and higher-than-expected other operating expenses and general and administrative (G&A) costs, which were not fully offset by stronger franchise margins and better-than-anticipated international sales.

Despite the mixed results, McDonald’s highlighted a sequential acceleration in U.S. comparable sales (comps) for January, even amid slow global industry trends. With a strong dividend history spanning 49 consecutive years and a current yield of 2.3%, the company maintains a solid financial foundation. The fast-food giant also provided guidance indicating an expected operating margin expansion by 2025. In response to these factors, BMO Capital’s analyst noted a tempered EPS estimate for 2025 but expressed confidence in the company’s potential for long-term growth. InvestingPro’s Financial Health Score of 2.9 (GOOD) supports this outlook.

The analyst’s optimism is rooted in McDonald’s favorable positioning in the near term, including its value leadership, which is believed to contribute to the acceleration of U.S. comps. The revised price target reflects a shift in BMO Capital’s valuation methodology to the year 2026 estimates, underscoring a positive outlook on McDonald’s ability to sustain compound growth over time.

McDonald’s Corporation, with its extensive global presence and strong brand, continues to adapt to market conditions and consumer preferences. Operating with a moderate level of debt and maintaining a robust EBITDA of $13.85 billion over the last twelve months, the company’s strategic initiatives, combined with its financial guidance, provide a basis for analyst expectations and investment outlooks. As the market processes the latest financial data and forecasts from McDonald’s, the updated price target from BMO Capital signals confidence in the company’s financial trajectory and market position. According to InvestingPro’s Fair Value analysis, the stock appears to be trading above its intrinsic value, making it one of many stocks featured in InvestingPro’s comprehensive research reports.

In other recent news, McDonald’s Corporation has been the subject of several optimistic adjustments from major financial institutions. JPMorgan has raised its price target for the fast-food titan to $300, following a strong fourth-quarter performance. Similarly, Citi analysts have increased their price target to $360, citing the company’s strategic focus on value offerings and customer engagement as key growth drivers.

Goldman Sachs also upped its outlook on McDonald’s, setting a new price target of $335. This reflects the firm’s confidence in McDonald’s ability to stimulate sales growth through value offerings and menu innovations, even in the wake of a recent E. coli incident.

Moreover, Jefferies has lifted its price target for McDonald’s to $349, maintaining a Buy rating on the company’s stock. The analyst noted positive signs in customer traffic and momentum going into the first quarter, suggesting that McDonald’s value messaging is resonating with consumers.

Lastly, Barclays (LON:BARC) has raised its McDonald’s price target slightly to $350, maintaining an Overweight rating. The firm noted the company’s strong international comparable sales, which have offset weaker results from the United States, and expressed expectations for margin expansion and increased capital expenditures in 2025. These recent developments highlight the financial sector’s confidence in McDonald’s ongoing performance and growth strategies.

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