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On Thursday, TD Cowen analysts reiterated a Hold rating for McDonald’s stock (NYSE: MCD), a $221 billion market cap leader in the Hotels, Restaurants & Leisure industry, while maintaining a price target of $305. According to InvestingPro data, analyst targets currently range from $300 to $364. The decision follows discussions with experts in the quick service industry, which have led to projections of a 2.8% increase in U.S. same-store sales for the second quarter of 2025.
The analysts noted that McDonald’s shares are expected to remain within a range of $305 to $320. While analysts project a P/E ratio of 23x-24x, InvestingPro data shows the current P/E at 27.45x. The company maintains a strong dividend track record, having raised dividends for 49 consecutive years, with a current yield of 2.27%.
Looking forward, industry experts express optimism regarding sales improvement in the second half of 2025. This outlook is largely driven by anticipated favorable comparisons and the launch of the McCrispy Strips, which are predicted to be McDonald’s most significant menu addition of the year.
Despite the positive outlook, the analysts conveyed skepticism about the widespread introduction of successful CosMc’s beverages to McDonald’s flagship brand during 2025. However, they highlighted the importance of launching cold brew coffee, which is operationally simpler and requires less customization.
Overall, TD Cowen’s analysis suggests that while McDonald’s is poised for potential growth, more consistent sales performance is necessary to move the stock beyond its current trading range.
In other recent news, McDonald’s Corporation (NYSE:MCD) has announced the closure of its standalone CosMc’s stores, a move aimed at integrating CosMc’s-inspired flavors into its main menu as part of an upcoming U.S. beverage test. This decision follows the company’s experiment with the beverage-focused outlets, which provided valuable insights for future product development. Additionally, McDonald’s shareholders recently voted on key issues at the 2025 Annual Shareholders’ Meeting, electing all 11 nominees to the Board of Directors and approving executive compensation. The meeting also saw the ratification of Ernst & Young LLP as the company’s independent auditor for the year.
In terms of analyst activity, Erste Group has downgraded McDonald’s stock from Buy to Hold due to expectations of slow sales growth in 2025. The firm cited McDonald’s strong operating margin but expressed caution regarding the stock’s near-term growth prospects. Meanwhile, Loop Capital and UBS have both maintained their Buy ratings on McDonald’s, with Loop Capital setting a price target of $346 and UBS at $350. Both firms are optimistic about McDonald’s strategic initiatives, which are expected to drive sales growth and market share gains in the coming quarters.
Loop Capital noted a positive trend in same-store sales for the second quarter, supported by new menu items like chicken strips and snack wraps. UBS highlighted McDonald’s ability to outperform industry peers despite global economic challenges, emphasizing initiatives such as the McValue platform and high guest satisfaction scores. These developments reflect ongoing efforts by McDonald’s to adapt to market conditions and enhance its product offerings.
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