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McDonald's Corp. (NYSE: MCD) again has proven that Wall Street's most optimistic forecasts are too conservative.The number one restaurant chain today reported an 8.2% rise in November sales, a 4.4% gain in U.S. same store sales, a 10.8% increase in Europe and a 12% jump in Asia/Pacific, Middle East and Africa. Shares of the home of the Quarter Pounder, up about 40% this year, rose to a 52-week high over $61 this morning.
One big reason for the company's success is coffee. The Oakbrook, Illinois-based company's promotion that lets consumers get any sized coffee for 69 cents is brilliant because it hits Starbucks Corp. (NASDAQ: SBUX) at its most vulnerable point: price.
McDonald's will continue to eat away at Starbucks when it begins pushing the fancy espresso drinks that it will sell at 800 locations next year. The company agreed to absorb some of the costs after franchisees balked. Will the trendoids that flock to Starbucks pretend to work on their laptops at McDonald's?
Maybe. I think the coffee is just as good as Starbucks premium brew, and without the pretentiousness.
But has all of the good news been priced into the stock?
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Reader Comments (Page 1 of 1)
12-10-2007 @ 12:35PM
Brian Patterson said...
My son got e coli 0157 H:7 from eating a McDonalds meal in August 2002. He was in the hospital on morphine for 7 days. Both McDonalds and Zurich Ins denied any liability yet the CDC National PulseNet database found PFGE matches. Meaning other people got sick eating the same beef lot number.
My advice to anyone is to save their receipts and an uneaten portion of their meal for further testing and confirmation.
12-20-2007 @ 8:25PM
WB said...
If you even have a son Brian, go spend time with him instead of living in the past. It was 5 years ago! You screwed up and couldn't get paid! Go spill hot coffee on yourself.