Fast food superpower McDonald’s Corporation (MCD) on Wednesday caught a big downgrade from analysts at Goldman Sachs.
The firm cut its rating on MCD from “Buy” to “Neutral” and lowered its price target from $100 to $92. That new target suggests a 5% upside to the stock’s Tuesday closing price of $87.51.
Goldman also cut its earnings estimates for MCD through 2014, noting several economic headwinds and a deceleration in same-store sales. The firm said it prefers other opportunities in the restaurant space, including Starbucks (SBUX) and Chipotle Mexican Grill (CMG).
McDonald’s shares fell 86 cents, or -1%, in premarket trading Wednesday.
The Bottom Line
Shares of McDonald’s (MCD) have a 3.20% dividend yield, based on last night’s closing stock price of $87.51. The stock has technical support in the $82-$85 price area. If the stock can firm up, we see overhead resistance around the $91-$92 price levels.
McDonald’s Corporation (MCD) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.