Analytical Review of the Stocks of McDonald`s Corp.

Analytical Review of the Stocks of McDonald`s Corp.

5 April 2016, 18:25
Roberto Jacobs
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Analytical Review of the Stocks of McDonald`s Corp.

McDonald`s Corp., #MCD [NYSE]
Services, Restaurants, USA

Financial performance of the company:

Index – DJIA, S&P 500;
Beta – 0.49;
Capitalization – 108.94 В;
Return on asset - 13.50%;
Income - 4.53 B;
Average volume – 7.04 М;
P/E - 24.67;
ATR – 2.52.

Analytical review:

  • The company ranks the first on capitalization among the issuers traded in the American stock market.
  • Since the beginning of March company’s shares has grown by over 9%. It is expected that the rise in quotes will continue.
  • According to the last report for Q4 of the fiscal year of 2015, the rise of company’s net profit exceeded 10%. Net profit has increased up to 1.21 billion USD. EPS rose by 15.5% from 1.13 USD to 1.31 USD.
  • In the near future the company planning aggressive expansion in the Asian region. In the next 5 years McDonald`s plans to launch 1500 new restaurants in China, Hong Kong and South Korea. Company’s executives believe that China will become the second largest market for McDonald`s. At the moment the leading markets are in the USA and Japan.
  • The company has the best profitability of capital and investments among the competitors in the marker. Return on investment is 13.63%. Return on equity is over 45%. Average performance in this sector is 9.02% and 13.66% respectively.
  • Large investment funds and banks (RBC Capital, Argus, Deutsche Bank) predict that company’s shares will rise up to 135 USD.


Summary:

  • Company’s report for Q4 of the fiscal year 2015 showed that management of the company is on the right track.
  • The Company has strong growth potential.
  • Development of business in China will increase investors’ confidence in the company.
  • Large investment funds predict positive dynamics of the company’s shares.
  • It is likely that in the near future company’s quotes will go up.


Trading tips for CFD of McDonald`s Corp.

Medium-term trading: the moment the issuer has broken resistance level of 124.75 USD. If the price maintains and tests the mirrored support level of 124.75 USD and in case of the respective confirmation (such as pattern Price Action), we recommend to open long positions. Risk per trade is not more than 2% of the capital. Stop order can be placed slightly below the signal line. Take profit can be placed in parts at the levels of 128.00 USD, 130.00 USD and 131.50 USD with the use of trailing stop.


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Short-term trading: on the chart with the timeframe 15M the issuer is traded between the local support and resistance levels of 126.85 - 127.80 USD. We recommend to enter the market after breaking out and testing of these levels. Positions shall be opened near the signal line and the nearest support/resistance levels. Risk per trade is not more than 3% of the capital. Stop order can be placed slightly above/below the signal line. Take profit can be placed in parts of 50%, 30% and 20% with the use of trailing stop.


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The material has been provided by LiteForex - Finance Services Company - www.liteforex.com


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