McDonald’s customers “still love it” despite restaurant spending cuts due to inflation.
For the fourth fiscal quarter, McDonald’s reported earnings per share of $2.59 on revenue of $5.93 billion. That compares to earnings per share of $2.45 on $5.68 billion in revenue expected by Wall Street, according to Refinitiv.
The fast-food giant also reported an increase in customer visits to its domestic restaurants and a 10.3% rise in sales in the United States, driven by higher menu prices and increased demand. Worldwide comparable store sales increased by 12.6% in the quarter.
“Overall, the consumer, whether in Europe or the United States, is holding up better than we expected a year or six months ago,” CEO Chris Kempczinski said on the conference call. of the company on Tuesday morning.
What this means for investors
Although the fast-food chain beat analysts’ expectations, Kempczinski gave a cautious outlook for 2023. The company expects near-term inflation to continue this year, but executives believe inflation probably peaked in the United States.
Looking further ahead in 2023, McDonald’s plans to open 1,900 new restaurants, including more than 400 located in the United States
On Jan. 31, McDonald’s shares fell slightly after reporting its latest quarterly results. Shares closed down about 1.3%, ending the session at $267.40 per share.
Here’s how much money you would have as of February 1, 2023 if you had invested $1,000 in the business one, five and 10 years ago.
If you invested $1,000 in McDonald’s a year ago, you would have about $1,066 as of Feb. 1, according to CNBC’s calculations.
If you had invested $1,000 in McDonald’s five years ago, you’d see a slightly higher return on investment and would have about $1,695 by Feb. 1, according to CNBC’s calculations.
And if you had given your $1,000 investment in McDonald’s a decade to grow, it would be worth about $3,270 as of Feb. 1, according to CNBC’s calculations.
Investors should do their research
Whether you invest $1,000 in Target, Apple, or other individual stocks, it’s important to remember that a stock’s past performance doesn’t necessarily predict its future performance.
Rather than trying to pick individual stocks, a passive investment strategy tends to make sense for most investors. Experts generally recommend investing in low-cost index funds, which are automatically diversified.
The S&P 500, a stock market index that tracks the performance of stocks of major publicly traded US companies, can be a great way to get started.
As of Feb. 1, the S&P 500 is down more than 9% from 12 months ago, according to CNBC calculations. However, the index has increased by around 44% since 2018 and around 170% since 2013.
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