McDonald's stock rating initiated at Sell by Melius on value concerns
Investing.com
Published Jul 14, 2025 07:30AM ET
Investing.com - McDonald's (NYSE:MCD) received a Sell rating as Melius initiated coverage on Monday with a price target of $250.00, notably below the current trading price of $299.91. According to InvestingPro data, the broader analyst consensus remains moderately bullish at 2.17, with price targets ranging from $260 to $365.
Melius cited concerns about McDonald's eroding value proposition, noting that pricing has outpaced consumer expectations despite the company's global scale and market position. The company maintains a strong financial health score of "GOOD" on InvestingPro , with an impressive track record of 49 consecutive years of dividend increases.
The research firm pointed out that while franchisee health and unit economics remain strong, McDonald's absolute price points appear high compared to quick-service restaurant peers and consumer income levels, particularly in the United States.
Melius expressed concern that customer traffic may remain weak or deteriorate over time without a reset in value perception among consumers.
The firm acknowledged that McDonald's stock reflects its scale and brand equity but suggested the market underappreciates the work required to restore relevance and value perception in what it described as a shifting competitive landscape.
In other recent news, McDonald's has experienced several notable developments. The fast-food giant is preparing for the reintroduction of its Snack Wrap menu item, with Truist Securities raising its price target to $356, citing expected sales momentum from this launch. Citi also increased its price target for McDonald's to $365, highlighting expectations of improved same-store sales and strategic initiatives in product innovation and digital capabilities. Conversely, KeyBanc lowered its price target to $325, pointing to competitive pressures and reduced consumer spending, although it maintained an Overweight rating. UBS reiterated its Buy rating and a $350 price target, viewing the recent share price decline as an opportunity for investors, with expectations of strengthened same-store sales in the latter half of 2025. Additionally, McDonald's and Krispy Kreme (NASDAQ:DNUT) announced the end of their partnership, effective July 2025, due to financial viability concerns for Krispy Kreme, though McDonald's noted the collaboration was a minor part of its breakfast business.
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