McDonald’s Corporation (NYSE: MCD) has confirmed the earning release date for Q4 2021 results which will be on Thursday, January 27, 2022, before the market opens.
What to look for
The company’s strong drive-thru operations and recent advances in delivery and technology have helped it combat the pandemic. MCD plans to introduce a loyalty program in each of the top six markets by the middle of 2022. In addition, it has made every attempt to increase its market share in overseas markets. Interestingly, pandemic-related problems persist, but a deteriorating economy and increased COVID cases have also knocked on MCD's margins.
Earnings: Stockearning’s Estimated EPSE for Q4 2021 is expected to be around $2.31. When the company released the last quarter results in October, the company reported earnings of $2.86 per share, representing a YoY increase, and topped Wall Street estimates by $0.4. Historical EPS performance indicates that in the past 12 quarters, the company has topped estimates six times (50%) and missed six times (50%).
Revenue: for the current quarter, the company expects revenue to beat the third-quarter revenue of $6.2 billion. Same-store sales were up 12.7% globally in the last quarter, while US sales topped the anticipated 9.6% growth. As a result, the company is expecting revenue growth for the full year in the mid-to-high teens.
Stock movement: MCD shares have gained 7.7% since the company released its third-quarter earnings. However, MCD shares have been DOWN 25 times out of the past 48 quarters. So, the historical price reaction suggests a 52% probability of the share price going DOWN once the company reports its fiscal Q4 2021 earnings. According to the Stockearning algorithm, the predicted first-day move is 2%, while the predicted move on the seventh day is 2%.
What analysts are saying
Piper Sandler analyst Nicole Miller Regan upgraded MCD from Hold to Buy and also raised the price target from $232 to $282. The analyst said that the company is uniquely positioned to capitalize on market share despite current operational challenges and cost pressures because of its scale, size, ongoing investments, and operational capabilities. In a note to investors, Nicole said that a recent survey leaves her increasingly optimistic about the company's sector-leading ability to meet consumer preferences via drive-thru experiences and high demand for main chicken and hamburger categories.
Goldman Sachs analyst Jared Garber raised the MCD's price target from $284 to $287 and maintained a Buy rating on the stock ahead of Q4 earnings. Garber told investors that MCD is well-positioned for the fourth quarter considering its robust digital trends and value. Still, he warns that globally the fast-food chain might experience deceleration in trends towards the end of the year.
Argus analyst John Staszak raised his price target on the MCD from $275 to $300 and maintained a Buy rating in the stock. According to the analyst, the MCD's "strong" delivery, digital, and drive-thru operations should enable it "endure" a phase of sluggish sector sales better than several other restaurant chains. Staszak also raises his FY21 EPS forecast for McDonald's by 4 cents, to $9.24, and his FY22 forecast by 3 cents, to $9.98.
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