McDonald's Upgraded At Piper Jaffray; Firm Sees $130 Upside

• McDonald's Corporation MCD shares have increased 18.9 percent year to date, touching a high of $110.87 on October 22.
• Piper Jaffray’s Nicole Miller Regan has upgraded the rating on the company from Neutral to Overweight, while raising the price target from $95 to $130.
• Miller Regan believes that there are several significant catalysts to the stock, with the company expected to “continue to execute against its strategic plan and leverage its economic advantage.”

McDonald’s reported a 4 percent year on year increase in its operating earnings for the third quarter, ahead of the consensus. Total revenues also came in ahead of the consensus. Global same store sales were much strong than expected, growing more than 4 percent.

The company expects to see positive same store sales in 4Q as well.

According to the Piper Jaffray report, “Management is coming from a position of strength in terms of executing strategy as changes at the executive and field level have been absorbed. This, in addition to an improving comp landscape, gives us confidence.”

While same store sales have been driven by “operational excellence,” Miller Regan mentioned that comps continue to benefit from “technology broadly, daypart platforms, menu/marketing innovation, and ultimately pricing power.”

McDonald’s shares are well positioned to outperform as the company continues to “leverage its economic advantage in terms of its industry-leading average unit volumes as well as the sheer size of its global footprint.”