Stock Traders Purchase Large Volume of Put Options on McDonald’s (NYSE:MCD)

McDonald’s Corporation (NYSE:MCD) was the recipient of some unusual options trading activity on Thursday. Stock traders purchased 47,332 put options on the company. This represents an increase of approximately 66% compared to the typical daily volume of 28,464 put options.

Wall Street Analysts Forecast Growth

Several analysts recently issued reports on the company. Argus cut their target price on McDonald’s from $320.00 to $310.00 and set a “buy” rating on the stock in a research note on Wednesday, August 26th. Wells Fargo & Company lowered their price target on McDonald’s from $320.00 to $300.00 and set an “overweight” rating for the company in a research report on Thursday, July 16th. KeyCorp dropped their price objective on McDonald’s from $315.00 to $305.00 and set an “overweight” rating for the company in a report on Wednesday, August 5th. UBS Group set a $305.00 price objective on McDonald’s in a research report on Wednesday, August 5th. Finally, Robert W. Baird raised McDonald’s to a “hold” rating in a research note on Monday, August 24th. One investment analyst has rated the stock with a Strong Buy rating, fifteen have assigned a Buy rating and eleven have given a Hold rating to the company’s stock. According to data from MarketBeat, the company currently has a consensus rating of “Moderate Buy” and an average price target of $316.39.

McDonald’s Trading Up 0.1%

Shares of MCD opened at $248.69 on Friday. McDonald’s has a 1-year low of $247.65 and a 1-year high of $341.75. The firm’s 50-day moving average price is $264.98 and its 200-day moving average price is $283.86. The firm has a market capitalization of $175.98 billion, a price-to-earnings ratio of 20.20, a PEG ratio of 2.69 and a beta of 0.41.

McDonald’s (NYSE:MCD) last released its quarterly earnings results on Tuesday, August 4th. The fast-food giant reported $3.38 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $3.32 by $0.06. McDonald’s had a net margin of 31.72% and a negative return on equity of 572.06%. The company had revenue of $7.10 billion during the quarter, compared to the consensus estimate of $7.13 billion. During the same period in the prior year, the firm earned $3.19 earnings per share. McDonald’s’s revenue was up 3.7% on a year-over-year basis. On average, research analysts forecast that McDonald’s will post 12.88 EPS for the current fiscal year.

McDonald’s Increases Dividend

The company also recently announced a quarterly dividend, which will be paid on Tuesday, December 15th. Stockholders of record on Tuesday, December 1st will be given a $1.93 dividend. The ex-dividend date of this dividend is Tuesday, December 1st. This represents a $7.72 annualized dividend and a dividend yield of 3.1%. This is an increase from McDonald’s’s previous quarterly dividend of $1.86. McDonald’s’s dividend payout ratio is currently 60.44%.

Key Headlines Impacting McDonald’s

Here are the key news stories impacting McDonald’s this week:

• Positive Sentiment: McDonald’s raised its quarterly dividend 3.8% to $1.93 per share, or $7.72 annualized, marking 50 consecutive years of increases and officially placing the company among the Dividend Kings. The increase supports the stock’s income appeal, with a yield of approximately 3.1%. McDonald’s marks 50 consecutive years of dividend increases
• Positive Sentiment: BTIG initiated or reiterated a “Buy” rating, while Citigroup maintained a Buy rating despite reducing its price target from $345 to $310. The revised target still implies substantial potential upside from current levels. McDonald’s earns Buy rating from BTIG Research
• Positive Sentiment: One Wall Street analyst argues that the selloff has created a possible 45% recovery opportunity if McDonald’s can restore sales momentum and close its valuation gap with the broader market. McDonald’s potential 45% gain

Institutional Investors Weigh In On McDonald’s

Several hedge funds have recently made changes to their positions in MCD. Allied Investment Advisors LLC boosted its holdings in shares of McDonald’s by 2.6% during the 4th quarter. Allied Investment Advisors LLC now owns 1,366 shares of the fast-food giant’s stock valued at $417,000 after buying an additional 34 shares in the last quarter. Sterling Investment Advisors Ltd. increased its stake in shares of McDonald’s by 0.6% in the 4th quarter. Sterling Investment Advisors Ltd. now owns 5,799 shares of the fast-food giant’s stock worth $1,772,000 after acquiring an additional 35 shares in the last quarter. Cypress Capital Management LLC WY lifted its position in McDonald’s by 7.0% during the 4th quarter. Cypress Capital Management LLC WY now owns 535 shares of the fast-food giant’s stock valued at $164,000 after acquiring an additional 35 shares during the period. Sound Income Strategies LLC lifted its position in McDonald’s by 0.6% during the 1st quarter. Sound Income Strategies LLC now owns 5,590 shares of the fast-food giant’s stock valued at $1,718,000 after acquiring an additional 35 shares during the period. Finally, Rooted Wealth Advisors Inc. boosted its stake in McDonald’s by 1.7% during the fourth quarter. Rooted Wealth Advisors Inc. now owns 2,207 shares of the fast-food giant’s stock worth $714,000 after acquiring an additional 36 shares in the last quarter. 70.29% of the stock is currently owned by institutional investors.

McDonald’s Company Profile

McDonald’s Corporation is a global quick-service restaurant company that operates and franchises restaurants under the McDonald’s brand. Its restaurants serve a menu that includes hamburgers, cheeseburgers, chicken sandwiches, French fries, breakfast items, desserts, salads, beverages and coffee. Offerings vary by market, and many locations provide drive-thru service, delivery and digital ordering through the McDonald’s mobile app.

The company operates through a heavily franchised business model, with restaurants owned and operated by independent franchisees, affiliates and the company itself.