McDonald's (MCD) Stock Forecast & Price Target

McDonald's has experienced a robust 26% increase in comparable store sales, showing a growth of approximately 15% compared to pre-pandemic levels in 2019. The company's ability to generate multiple years of significant sales growth in the U.S. is enhanced by improved consumer trends, particularly fueled by successful promotions such as the Monopoly campaign, and has prompted an upward revision in both 2026 comparable sales and earnings per share projections. Additionally, McDonald's strong revenue model, which relies heavily on franchise royalties and rent, positions the company favorably as it continues to innovate its menu, enhance digital sales, and improve service quality.

The financial outlook for McDonald's reflects concerns over declining traffic trends in the U.S., which may be indicative of broader economic pressures impacting consumer spending habits. The recent slowdown in comparable sales, particularly the 120 basis points deceleration noted in September, combined with industry-wide reports of sales weakness, suggests that McDonald's may be vulnerable to a potential economic recession that could further reduce customer visits and spending per visit. With earnings growth appearing increasingly normalized and less opportunity for upside, coupled with an above-historical average multiple, the company faces heightened risks that could negatively affect its overall financial performance.