McDonald’s Corporation (NYSE:MCD) is on many traders’ watch-lists today after Jeff Farmer of Wells Fargo upgraded the fast food chain to ‘Outperform’ from ‘Market Perform’. Farmer also raised his target price to $145-$150 from the previous $125-$130, citing potential multiple expansion next year due to expected improvement in return on invested capital and margin gains. The analyst also likes McDonald’s Corporation (NYSE:MCD)’s mobile presence, which could potentially lead to market share gains ahead. As more millennials and teens order food from mobile phones, McDonald’s cutting edge mobile/payment technology could make a meaningful difference in terms of boosting demand.
After dipping late last year, shares of McDonald’s have outperformed, rallying 8.22% year-to-date. The stock currently trades for 19.75 times forward earnings estimates and yields 2.88%.
What Does The Smart Money Sentiment Say?
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Smart money sentiment surrounding McDonald’s Corporation (NYSE:MCD) was stable in the fourth quarter. Of the 742 elite funds we track, 55 funds owned $2.8 billion of McDonald’s Corporation (NYSE:MCD) and accounted for 2.80% of the float on December 31, versus 55 funds and $2.77 billion respectively on September 30.
The Bottom Line
McDonald’s Corporation (NYSE:MCD) is in the spotlight due to a Wall Street upgrade. For more reading, check out ‘12 Best Bargain Burgers and Fries in America‘.