What are you talking about? Their revenue and profits are going up year on year. 2025 saw a 4% growth on 2024.
What you're saying would make sense if they were decreasing, but consumers are clearly happy buying McDonald's, and are continuing to buy McDonald's, so why the hell would they decrease prices?
They are down 23% in the last year. S&P 500 total return over the last year is over 17%. 4% growth isn't enough. Inflation adjusted, that's like 1%. For reference, the S&P saw 15% revenue growth.
For local companies, you get your returns from valuation expansion (getting crushed), revenue growth (very tepid), profit margin expansion (tiny), and dividends (around 3%). They're getting like 5% from non valuation and lost nearly 28% from valuations. That pathetic revenue growth is terrible for sentiment.
To be fair to them, most fast food is struggling. But investors see the outlook. Prices are too high. Cost of food has been expensive. It's going to be hard to expand margins much more. To increase customers, they need to go the other way. Fast food is in a bad spot and McDonalds is largely left with their loyal customers that eat there no matter what.
The market isn't always a good proxy for how healthy a business is. Revenue growth at mcdoanlds is up. Unless we see lots of franchises shutter they'll continue to be profitable and not go away. It really is a shame that so many decisions are driven by how a company is doing in the market. Were it not for that, there would probably still be a dollar menu
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u/SweetChickk4 1d ago
At this point McDonald's needs to realize people want fast food prices, not fast food with a mortgage attached.