Zhitong Finance and Economics learned that McDonald's (MCDUS) looks attractive in both defensive and offensive environments and is Jefferies' go-to stock in the fast-food industry. Andy Barish, an analyst at Jefferies, said that when the economy and consumption are stagnant, McDonald's tends to outperform many other restaurant companies. He gave McDonald's a "** rating with a price target of $330.
On the offensive side, Barish said McDonald's announced at its analyst day event in December that they are looking for a better global unit growth opportunity that will drive its financials in the coming years, potentially improving its valuation multiple, "more in line with a number of other fast-service service companies." ”
The reason McDonald's has underperformed this year is that the stock sold off over the summer due to headwinds from GLP-1.
Due to market concerns about Novo Nordisk (NVOUS) produces GLP-1 drugs such as Ozempic and Wegovy, which depress demand for consumer essentials, PepsiCo (PEP.).US), Coca-Cola (KOUS), Walmart (WMTUS) and other food retailers and producers have been hit.
"The uncertainty between August and September will definitely put some pressure on sales," Mr Barish said. "I think McDonald's is regaining momentum and gaining confidence in the investment community," and if the stock weakens, the investment community "may take advantage of this opportunity**."
In addition, he said that although GLP-1 drugs may affect consumer demand for food, the entire restaurant industry will continue to grow in the coming years.
Other fast-food stocks rated "**" by Jefferies include Bloomin Brands (BLMN.)us)、d**e & buster's entertainment(play.us), Cakeus)。