I'm LongbridgeAI, I can summarize articles.McDonald's (MCD) stock offers reasonable valuation at 18.3x expected 2027 earnings after underperforming the S&P 500 in 2026. Despite weak comparable sales, Q2 revenue grew 4% and EPS rose 6%. Analysts expect EPS growth to accelerate to 8% in 2027, supporting a Buy rating. The company appointed Skye Anderson as President of McDonald's USA to address U.S. sales weakness. Potential catalysts include moderating energy inflation and possible Fed rate cuts, which are not yet reflected in the current valuation.
McDonald's (MCD) stock offers a more reasonable valuation after underperforming the S&P 500 (SPX) in most of 2026. The fast-food restaurant chain reported 4% revenue growth in Q2 2026, in line with the performance achieved in 2025. Yet, it looks like investors were disappointed by weak comparable sales growth, with recent top-line expansion driven by new store openings, which naturally require more investment.
Against this backdrop, the company still managed to increase earnings per share (EPS) by 6% in Q2 2026 even after absorbing higher financing costs. Analysts expect McDonald's EPS growth to accelerate to about 8% in 2027, supporting a Buy rating on the shares as they now trade at only 18.3x expected 2027 earnings.
McDonald's is also taking steps to address weak U.S. sales growth by appointing Skye Anderson as the new President for McDonald's USA. Likewise, I believe moderating energy price inflation could allow the Fed to resume rate cuts in H2 2027 and into 2028. I believe these potential positive catalysts are not reflected in McDonald's valuation.