Stifel maintained its ‘Hold’ rating on McDonald’s and said that assessing the impact of McDonald’s reportedly agreeing with franchisees to lower prices on several combo meals is complex due to regional price differences and varying consumer perceptions.
McDonald’s (MCD) witnessed a price target hike from Stifel on Friday, with the firm raising the target to $315 from $300, noting that the fast-food chain should drive awareness with its “promising” second-half promotional lineup.
Retail sentiment on McDonald’s remained unchanged in the ‘neutral’ territory, with message volumes at ‘low’ levels, according to data from Stocktwits. Shares of the company were up marginally in premarket trading on Friday.
Stifel maintained its ‘Hold’ rating on McDonald’s, according to TheFly. The firm added that assessing the impact of McDonald’s reported agreement with franchisees to lower prices on several combo meals is complex due to regional price differences and varying consumer perceptions. Stifel analyst Chris O’Cull noted that his view on the promotional lineup for the second half is “more constructive” with a wait-and-see approach until more details emerge.
In early August, McDonald’s CEO Chris Kempczinski said that overall quick-service-restaurant traffic in the U.S. remained challenging as visits across the industry by low-income consumers declined once again by double digits versus the prior year period.
Kempczinski had noted that reengaging the low-income consumer is critical, as they visit McDonald’s more than those from the other income groups.
He had then said that the company continued to see incrementality from its McValue platform, which also includes a buy-one, add-one-for-a-dollar deal, which launched at the beginning of this year.
Shares of McDonald’s have jumped over 8% in the last 12 months.
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