The golden arches may be the most recognizable branding across the globe. But is McDonald’s stock (NYSE: MCD) a buy in 2023?
McDonald’s is one of the world’s most recognizable brands, and its success over the last seven decades has been extraordinary.
With more than 38,000 restaurants in more than 100 countries and territories around the world, it is no surprise that many investors are interested in learning more about the company’s future outlook.
Let’s take a look at what we can expect from McDonald’s in 2023.
Then, we’ll run McDonald’s stock through our proprietary Stock Power Ratings system.
McDonald’s Business Model
McDonald’s operates on a franchise system, meaning that individual restaurant owners pay a fee to be part of the brand.
This model has allowed McDonald’s to expand quickly and easily into new markets with minimal upfront investment for each location.
In addition to franchising, McDonald’s also owns and operates company-owned stores in some countries.
These types of stores are typically larger and offer more amenities than typical franchised locations.
Strategies and Outlook for 2023
The company has several strategies in place for continued growth in 2023.
These include increasing focus on digital ordering and delivery services, as well as expanding within new markets such as India and China.
Additionally, McDonald’s is investing heavily in technology initiatives such as artificial intelligence-driven customer service solutions and self-order kiosks.
These initiatives will help the company increase efficiency while also providing customers with an improved experience.
Over the past few years, McDonald’s has seen mixed financial growth due to sales from franchised locations and its own corporate stores.
This growth can be attributed to its focus on technology investments, expansion into new markets, and continued commitment to improving customer experiences across all locations worldwide.
But revenue growth slowed slightly in 2022 as the company faced a more uncertain economic situation.
Let’s see what else we can figure out about McDonald’s stock using our proprietary ratings system.
McDonald’s Stock Power Ratings
McDonald’s stock rates a “Neutral” 60 out of 100. That means our system expects the stock to perform in line with the broader market over the next 12 months!
MCD’s Stock Power Ratings in January 2023.
I mentioned slower growth above. And you can see that reflected in McDonald’s stock’s 59 out of 100 rating on our growth factor.
Outside of a stellar 2021, where McDonald’s revenue soared almost 21% year over year, MCD’s revenue has been in slow decline since 2016.
But increased economic and market uncertainty over the last year has actually helped McDonald’s.
In the midst of a bear market, investors seek safety.
And there is safety in a strong brand like McDonald’s.
That’s partly why McDonald’s stock rose almost 10% over the last year. And that’s why it boasts a strong 94 rating on our momentum factor.
Bottom Line: As one of the world’s most recognizable brands, it is not surprising that many investors are interested in learning more about MCD.
But our Stock Power Ratings system says this is one to watch since it’s set to perform in lockstep with the rest of the market.
Time will tell.