McDonald’s stock hits all time high
Posted Thursday, November 27, 2011 1:07 pm
By TONY EVANS/Staff Writer
McDonald’s Corp. is off to a good start — and it’s likely to keep going
The stock of America’s favorite fast-food brand is at record highs, up 28.4 percent in the past year and trading at more than $65 per share.
McDonald’s Corp. and its industry rivals — especially the parent company of Burger King Corp. — remain well-positioned for growth.
Investors are piling a record-breaking amount of the company’s stock on their balance sheets. The company reported a net profit of $1.03 billion, or $3.30 per share, in the fourth quarter and a quarterly dividend of $0.48 per share.
At the company’s current market price of $75.63 per share, McDonald’s is worth more than $2.2 billion. The stock is up more than 300 percent in the past year.
“McDonald’s is a highly integrated company,” said Tom Freston, an analyst with Morningstar Inc. “A huge part of the company’s value is due to the company’s position in every single aspect of the fast-food industry.”
McDonald’s has been in the fight-me-or-buckle-up business for decades, but the company had been on an upswing when the economic downturn took hold. Consumers went through a significant pullback in discretionary spending, and a lot of other companies followed McDonald’s lead and closed, Freston said.
McDonald’s was one of the few stocks that saw its sales and earnings per share rise in the fourth quarter.
The most recent quarterly growth came from the company’s U.S. restaurants, where sales increased 1.4 percent. This was despite a 1.6 percent dip in average check prices in a market that had been in the doldrums for several years. U.S. restaurant sales are in line with the consensus for the year.
The U.S. restaurant business is where the biggest gains came in the last year.
McDonald’s is still growing at a faster pace than the overall market. It’s projected to have 14 percent compound growth in U.S. restaurant sales for the year through December, according to a FactSet research