Baird Revises McDonald’s (MCD) Outlook after Earnings Update

McDonald’s Corporation (NYSE:MCD) is included among the 10 Best Inflation-Hedge Stocks to Buy for 2026.

Baird Revises McDonald’s (MCD) Outlook after Earnings Update

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On May 8, Baird lowered its price recommendation on McDonald’s Corporation (NYSE:MCD) to $305 from $330. It reiterated a Neutral rating on the shares. The firm updated its model following Q1 results, saying optimism around the company’s internal growth drivers was being balanced against broader external risks.

During the Q1 2026 earnings call, Chairman, President, and CEO Christopher Kempczinski said global system-wide sales rose 6% in constant currency, while global comparable sales increased 3.8%. He also noted that McDonald’s gained market share in nearly all of its top 10 markets during the quarter. Executive Vice President and Global CFO Ian Borden said strong revenue performance helped drive adjusted earnings per share of $2.83. That figure included a $0.13 benefit from foreign currency translation.

Borden added that adjusted operating margin came in at 46%. He also acknowledged that margins at U.S. company-operated restaurants fell short of expectations and described the results as unacceptable. According to Borden, McDonald’s is reassessing the mix between franchised and company-owned locations as it looks to maximize value across the system. On restaurant expansion and rising construction costs, management reaffirmed its long-term growth plans while taking a more measured approach toward returns. Borden said the company still believes it can reach about 50,000 restaurants by the end of 2027. Kempczinski added that management is reevaluating the development pipeline as construction costs continue to rise.

McDonald’s Corporation (NYSE:MCD) is a global foodservice retailer with operations across the US, International Operated Markets, and International Developmental Licensed Markets & Corporate segments. The US remains its largest market, with about 95% of locations operated by franchisees.

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