Seaport Slaps McDonald's with Neutral Rating Amid Execution Concerns

Seaport Global Securities has initiated coverage of McDonald's Corp. (MCD) with a Neutral rating, citing execution challenges and a difficult operating environment.

The firm stated that McDonald's missed an opportunity to leverage its competitive advantages in 2026 as execution fell short of expectations.

Seaport noted that the company's scale advantages and presence are unmatched within the quick service restaurant industry, but the operating environment remains challenging due to rising interest rates, economic pressure on lower income consumers, elevated beef costs, and an unrelenting competitive environment.

The firm predicts material improvement is unlikely until mid-2027 based on year-over-year comparisons. The stock trades at 18 times 2027 earnings per share, six turns below its five-year historical average of 24 times next-twelve-months price-to-earnings.