MCD With Distinct Competitive Advantage
Analysts at Citigroup reiterate their "hold" rating on McDonald's Corp (NYSE: MCD). The target price for MCD is set to $74.
MCD posted healthy growth during 2009 “despite a difficult macro and competitive backdrop, and appears poised to continue that momentum through the n-t.” According to the analysts, “The co’s n-t priorities revolve around accelerated reimaging (going from roughly 1800 units WW in ’09 to 2300 in ’10), continued menu development/innovation, and enhancing the in-store experience (new POS systems to help improve speed of service, order accuracy, etc.). In our view, these factors should help continue to differentiate the MCD brand and drive continued share gains in ’10.”
MCD has strong balance sheet and estimated FCF of around $4.00 per share in 2010. “We believe MCD has distinct competitive advantage versus many of its peers….While momentum is clearly moving in the right direction for MCD in the n-t, and the co. continues to make investments to drive solid l-t growth and enhance shareholder returns,” the analysts add.
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