Retail

Why Weak McDonald's Sales Are Looking Good

After having a first quarter full of ups and downs, McDonald’s Corp. (NYSE: MCD) is looking just a little more stable after the golden arches reported its global comparable sales for April. Despite global comparable sales decreasing by 0.6%, it is really not as bad as most were expecting.

Comparable sales were expected to decline by 1.8% globally, according to the Consensus Metrix research firm.

In terms of the breakdown, U.S. comparable sales were down 2.3%, Europe was up 1.0% and Asia/Pacific, Middle East and Africa (APMEA) was down 3.8%.

The U.S. comparable sales suffered due to ongoing competitive activity and negative customer traffic. McDonald’s is currently in the middle of a total overhaul on its image in an attempt to drum up more traffic domestically. Current initiatives include adding kale and other organic food to the menu, and the company is even rebranding the Hamburglar.

Ultimately the fall in the U.S. comparable sales was in line with analysts’ expectations.

ALSO READ: The States With the Most McDonald’s

Europe’s performance was the saving grace for McDonald’s in April. Strong results in the United Kingdom and Germany helped offset weaker performances in both France and Russia. McDonald’s Europe continues to target opportunities to enhance its popular promotional menu options and build on its value, breakfast and family business amid ongoing macro-economic headwinds across much of the segment.

Analysts were only expecting a 0.2% increase for European sales.

The drop in APMEA is not as bad as was expected, with analysts calling for a drop of 5.8%. The decline was attributable to a challenging Japanese market but slightly offset by strong sales in Australia.

Steve Easterbrook, president and CEO, commented on the sales:

Earlier this week, we announced the initial steps in McDonald’s business turnaround plan. We are moving quickly to deliver a better experience to our customers and to realize our vision to become a modern, progressive burger company. While our current performance reflects the significant work ahead, I am confident that we’ve taken the first critical steps toward positioning the company for long-term profitable growth.

Note that systemwide sales for the month decreased 8.8%, but these sales increased 1.5% in constant currencies.

Shares of McDonald’s were up 1.3% early Friday, at $98.01 in a 52-week trading range of $87.62 to $103.78. The stock has a consensus analyst price target of $101.18.

ALSO READ: McDonald’s Credit Ratings Fall on Turnaround Plan Share Buybacks

Credit Card Companies Are Doing Something Nuts

Credit card companies are at war. The biggest issuers are handing out free rewards and benefits to win the best customers.

It’s possible to find cards paying unlimited 1.5%, 2%, and even more today. That’s free money for qualified borrowers, and the type of thing that would be crazy to pass up. Those rewards can add up to thousands of dollars every year in free money, and include other benefits as well.

We’ve assembled some of the best credit cards for users today.  Don’t miss these offers because they won’t be this good forever.

Flywheel Publishing has partnered with CardRatings for our coverage of credit card products. Flywheel Publishing and CardRatings may receive a commission from card issuers.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.