Consumers are leaning into McDonald’s during high-inflation period – Seeking Alpha


McDonald"s Second Quarter Sales Up 57 Percent From Previous Year

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McDonald’s Corporation ( NYSE: MCD ) posted one of the biggest gains in the restaurant sector in Wednesday morning trading after BTIG reiterated a bullish view on the stock.

Channel checks with franchisees by BTIG showed sales strength, despite the macro headwinds.

Analyst Peter Saleh “We recently conducted a round of franchisee checks to gauge sales trends, major initiatives and general sentiment for the McDonald’s system, in addition to the checks on McPlant published last week. Our conversations indicated same-store product sales improved sequentially through the second quarter, despite record high fuel prices and inflationary pressures, as consumers gravitate toward familiar and trusted brands. ”

Recent sales strength at the chain were noted to be led simply by breakfast, delivery and benefits with the loyalty program, in addition to several menu price hikes which were fired off to offset record commodity plus labor inflation.

Saleh and team maintained a Buy rating on MCD plus price target of $280 due to the indication of product sales momentum, defensive nature of the stock, and global diversification of the business.

McDonald’s ( MCD ) can be expected to report Q2 earnings during the last week within July.

The Seeking Alpha Quant Rating on MCD is only at Hold, but it is the 9th highest in the restaurant sector.