Jefferies Sticks with McDonald's Buy Rating Despite Analyst Pessimism

Jefferies has reiterated its 'Buy' rating on McDonald's Corp. (MCD) stock, citing a margin outlook that exceeds expectations for operating margin expansion through 2030.

The company's new long-term growth algorithm is expected to support a return to low single-digit percentage same-store sales growth, with unit growth moderating in 2028 and beyond.

InvestingPro analysis suggests that McDonald's stock is undervalued relative to its Fair Value, with the current price of $238.32 near its 52-week low of $234.03.

The firm's 'NEXT' initiative, which includes remodels and rent relief, is expected to support a larger remodel cycle than previously anticipated.

However, not all analysts agree on McDonald's prospects. BMO Capital has lowered its price target to $310 due to concerns about the timeline of the company's NEXT strategy and 2030 targets, although it maintains an Outperform rating.