Why McDonald's Looks Delicious
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, fast-food giant McDonald'shas earned a coveted five-star ranking.
With that in mind, let's take a closer look at McDonald's and see what CAPS investors are saying about the stock right now.
Oak Brook, Ill. (1940)
CEO Donald Thompson (since 2012)
Return on Equity (Average, Past 3 Years)
$2.2 billion / $13.3 billion
Burger King Worldwide
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 95% of the 6,179 members who have rated McDonald's believe the stock will outperform the S&P 500 going forward.
McDonald's is a very mature fast food restaurant with significant growth opportunities outside of the United States. Especially in China, India, and the rest of Asia. While hamburgers will always be on the menu [McDonald's] will adapt as necessary in other markets.
[McDonald's] has been soft over the near-term. As the economy continues to slowly improve the company's results will become stronger. Better earnings results will improve the stock price.
I compute an Intrinsic Value for the shares in the $132-$137 per share range assuming an EBITDA growth rate in the 8.25%-8.75% range over the next five years.
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The article Why McDonald's Looks Delicious originally appeared on Fool.com.Fool contributor Brian Pacampara has no positions in the stocks mentioned above. The Motley Fool owns shares of McDonald's. Motley Fool newsletter services recommend Burger King Worldwide and McDonald's. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.