Fast-food chain McDonald’s (NYSE: MCD) will be reporting results tomorrow before market open. Here’s what to look for.
McDonald's missed analysts’ revenue expectations by 2.1% last quarter, reporting revenues of $6.49 billion, flat year on year. It was a slower quarter for the company, with a miss of analysts’ EBITDA and earnings estimates.
Is McDonald's a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting McDonald’s revenue to grow 1.9% year on year to $6.82 billion, slowing from the 14% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $3.20 per share.
Heading into earnings, analysts covering the company have grown increasingly bullish with revenue estimates seeing 14 upward revisions over the last 30 days (we track 24 analysts). McDonald's has missed Wall Street’s revenue estimates twice over the last two years.
Looking at McDonald’s peers in the restaurants segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Domino's delivered year-on-year revenue growth of 5.1%, missing analysts’ expectations by 1.6%, and Texas Roadhouse reported revenues up 13.5%, in line with consensus estimates. Domino's traded up 4% following the results while Texas Roadhouse was also up 3.6%.
Read our full analysis of Domino’s results here and Texas Roadhouse’s results here.
There has been positive sentiment among investors in the restaurants segment, with share prices up 2.5% on average over the last month. McDonald's is down 3.9% during the same time and is heading into earnings with an average analyst price target of $318.66 (compared to the current share price of $292.70).
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