{"id":10126,"date":"2024-04-30T07:00:16","date_gmt":"2024-04-30T04:00:16","guid":{"rendered":"https:\/\/ch.jfdi.cc\/?p=10126"},"modified":"2024-04-30T07:00:16","modified_gmt":"2024-04-30T04:00:16","slug":"mcdonald-s-set-for-weak-sales-growth-as-us-fast-food-chains-grapple-with-muted-traffic","status":"publish","type":"post","link":"https:\/\/ch.jfdi.cc\/?p=10126","title":{"rendered":"McDonald, \u2019s set for weak sales growth as US fast-food chains grapple with muted traffic"},"content":{"rendered":"
<\/div>\n

McDonald\u2019s (MCD.N) is set to report a sequential drop in sales growth for the fourth straight quarter as low-income consumers remain hesitant about eating out even as fast-food chains battle to lure them with value menu items.
\nThe burger giant will report first-quarter results on Tuesday, kicking off earnings for US restaurant chains, with top players such as Starbucks (SBUX.O) and KFC-parent Yum Brands (YUM.N) set to report results later in the week.
\n\u201cWe expect traffic to continue to be negative and believe the average check will remain under pressure from the heavy discounting to recover lower-income consumer traffic,\u201d BTIG analyst Peter Saleh said.
\nMcDonald\u2019s has leaned on its Dollar Menu, offering items in the $1, $2, $3 price points to lure in diners on a budget, while Wendy\u2019s this month offered some items for just a dollar on orders placed via apps. Taco Bell also launched a new Cravings Value Menu for some burritos and tacos at $3 or less in January.
\nTHE CONTEXT<\/strong>
\nAfter a slow start to the year at McDonald\u2019s owing to inclement weather in January and choppy spending due to still-high inflation, Wall Street analysts believe discounting could be a theme for the rest of the year at the food joints.
\nVisits to McDonald\u2019s rose 2.4 per cent in the January to March period, Taco Bell saw a 3.8 per cent jump and Chipotle a 10 per cent increase, data from Placer.ai showed.
\nMcDonald\u2019s is also expected to continue to see sales drag from its International Developmental Licensed Markets segment, which has been hurt by the Israel-Hamas conflict and weak demand in China.
\nAt least five brokerages have trimmed their price target on the company\u2019s stock so far in April.
\nTHE FUNDAMENTALS<\/strong>
\n** McDonald\u2019s is expected to show a 2.36 per cent rise in global same-store sales when it reports first-quarter results on Tuesday, while earnings per share (EPS) is expected to come in at $2.72.
\n** A day later, Yum Brands is expected to post a 0.34 per cent increase in worldwide same-store sales for the first quarter, compared with a rise of 1 per cent in the fourth quarter and up 8 per cent last year. First-quarter EPS is expected to rise to $1.20.
\nWALL STREET SENTIMENT<\/strong>
\n** McDonald\u2019s shares have lost nearly 8 per cent year-to-date, roughly similar to Starbucks, while Chipotle has surged about 40 per cent. Yum Brands and Wendy\u2019s are up about 8.5 per cent and 3.4 per cent, respectively.
\n** The S&P 500 Restaurants index (.SPLRCREST) is up 0.88 per cent in the same period, underperforming a nearly 7 per cent jump in the benchmark S&P 500 (.SPX).
\n** McDonald\u2019s has an average rating of \u201cbuy\u201d, with 38 analysts covering the stock, their median price target is $325, according to LSEG data.
\n** Yum Brands has a current average rating of \u201chold\u201d, with 29 analysts covering the stock, and a median price target of $145.04.<\/p>\n","protected":false},"excerpt":{"rendered":"

McDonald’s is expected to report a sequential drop in sales growth for the fourth straight quarter as low-income consumers remain hesitant about eating 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