McDonald's Likely to Report 'Sluggish' Q2 Same-Store Sales, UBS Says

MT Newswires Live00:28

McDonald's (MCD) is expected to report "sluggish" Q2 same-store sales as weaker consumer spending and "difficult" comparisons pressure results in the US and globally, UBS Securities said in a report Monday.

The firm forecasts Q2 US same-store sales growth of 0.5%, below the 0.8% consensus estimate, despite new beverages, value meals, menu items and marketing initiatives. International Operated Markets sales are expected to rise 1%, also below consensus, according to the report.

Sales trends could improve in the H2 as McDonald's benefits from its menu upgrades and digital investments. The firm expects the company to continue gaining market share through 2027, UBS said.

McDonald's September investor day is expected to provide details on "menu innovation," marketing, artificial intelligence technology, restaurant upgrades and its global expansion targets, the report said.

UBS said the stock's risk-reward remains attractive despite near-term pressures, but lowered the price target to $340 from $365 and maintained a buy rating, to reflect weaker sales trends and macroeconomic headwinds.

Price: 269.52, Change: +4.76, Percent Change: +1.80

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