I'm Lovin It!! (MCD)

Shares of McDonald's

are on the rise this morning after it reported better than expected July same store sales. I love the fast food retailer going forward and believe it is likely to succeed whether the economy recovers or turns back down. McDonald's reported sales rose 7 percent around the globe and July sales at restaurants open at least 13 months climbed 5.7 percent here in the United States, its largest gain since April 2009. Sales were helped by the new fruit smoothies launched last month, and ice-cold frappes also got a warm reception from customers. Besides operating and firing on all cylinders at its stores, McDonald's has raised its dividend every year since 1976 and should raise it again this year. McDonald's now boasts a dividend yield of 3.1%, well above the yield for the 10 year U.S. Treasury. McDonald's should also benefit are the dollar continues to weaken as its costs are solely measured in dollars, but its profits are measured in currencies in which the restaurant operates. Signs of a deflationary environment are starting to emerge as the savings rate rose last month to 6.4%, indicating consumers are not spending their income and when they are, they are trading down to places like McDonald's. CEO Jim Skinner has introduced many new initiatives since becoming CEO such as the McCafe concept, Angus Burgers and other menu items that consumers love. I could see McDonald's hitting $76 by years end on continued growth and strong operating results, and I believe McDonald's could hit $85 within a 12 month time frame. Even though Ronald McDonald may no longer be featured prominently as the spokesman for the golden arches, the golden arches continues to chug along just fine and portfolios are just lovin' it.