McDonald’s Earnings: Here’s Why Shares are Down Now

McDonald’s Corp. (NYSE:MCD) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 2.20%.

McDonald’s Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 4.55% to $1.38 in the quarter versus EPS of $1.32 in the year-earlier quarter.

Revenue: Rose 2.43% to $7.08 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: McDonald’s Corp. reported adjusted EPS income of $1.38 per share. By that measure, the company missed the mean analyst estimate of $1.4. It missed the average revenue estimate of $7.09 billion.

Quoting Management: “While our consolidated results this quarter were positive, global comparable sales for July are expected to be relatively flat,” said CEO Don Thompson in a statement. “Based on recent sales trends, our results for the remainder of the year are expected to remain challenged.”

Key Stats (on next page)…

Revenue increased 7.25% from $6.61 billion in the previous quarter. EPS increased 9.52% from $1.26 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $1.57 to a profit $1.55. For the current year, the average estimate has moved down from a profit of $5.77 to a profit of $5.69 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)