I Never Did Like McDonald’s

June 15, 2015 0 Comments

Food or Financial wise, there is really very little that appeals about the company. The only time when I really enter a store is when I need to use the WiFi (which is probably worse than most Starbucks hotspots). The only other time is when there is absolutely nothing else around to eat. However, I don’t think my business would help the company, whether I was a regular or not.

Yesterday, McDonalds released their comparable sales, and while the company sales has been struggling as of late, there is hardly any evidence of a turnaround. It’s making a really difficult case for shareholders to justify any meaningful investment in the once prominent business.

According to the latest Current Profile sales, the company saw comparable sales decline 0.3% in the month of May. In the United States, comp sales declined 2.2%, as well as a 3.2% decline in the Asia-Pacific-Middle East & Asia (APMEA). The only region that seemed to fair better was Europe, which experienced a 2.3% increase in sales.

Globally, the trends don’t seen as terrible; however, the United States is the company’s most important market. Overall trends look bleak for the company, as comparable sales have declined for the entire company for more than a year.

Still expecting to get $15 an hour from Corporations like McDonald’s? I wouldn’t hold my breath…

Sales have been so bad, the company actually decided to stop reporting their monthly comparable store sales, started in June.

Here is the stock price in recent history:

The company peaked at $101 per share on 5/18, then its been in free fall ever since. This was most likely during the time when McDonald’s decided to stop reporting monthly sales.

They’ve changed their CEO, now McDonald’s has already announced that they have a turnaround plan geared towards reorganizing its business in an effort to stabilize franchise grow and return capital to the shareholders. Something that I’ve already talked about on my article about JP Morgan Chase & Co.

The question is will it be enough? I don’t think their plans has done anything to address the Chinese food scandals that have damaged stores in the APMEA region. You also have a shift in the interest of other fast food retailers. Companies like Chipotle have healthier food choices and a much better alternative than the unhealthy foods people were used to.

To be honest, I thought the lack of sales would have been blamed on other factors, such as a strengthening dollar (which is bad for Corporate Profits, as I previously explained). Regardless, in light of these statistics, there is no reason to be bullish on this company (I never was).

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