Why McDonald's Is About to Become a $300 Stock Again

Core Viewpoint - McDonald's has experienced a mixed performance in 2024, with a notable rebound expected in 2025 due to bullish analyst updates and strong fundamentals [2][5][11] Group 1: Financial Performance - McDonald's shares are currently trading 11% below their all-time highs, with a market cap exceeding $200 billion [1] - The company missed analyst expectations for earnings in the first half of 2024 but reported record revenue in October, offsetting some weaknesses in comparable sales [2][3] - The stock has a 12-month price forecast of $321.39, indicating a potential upside of 13.49% based on 27 analyst ratings [5] Group 2: Analyst Sentiment - Recent bullish updates from analysts, including Citi's upgrade from Neutral to Buy, suggest significant upside potential for McDonald's stock [5][8] - Loop Capital's price target of $342 indicates a targeted upside of approximately 20% from recent closing prices [5] - McDonald's was named one of Wells Fargo's top restaurant picks for 2025, reinforcing its potential to reclaim previous highs [6] Group 3: Market Conditions - Despite the positive outlook, there are bearish risks due to a broader cooling in investor sentiment towards equities and the restaurant industry [7][8] - Citigroup warned of potential headwinds in 2025, including a slowing labor market and a possible decline in industry sales [7] Group 4: Technical Analysis - The stock's Relative Strength Index (RSI) is currently at 33, indicating oversold conditions and suggesting a potential for a strong rebound [9][10] - A reading below 30 typically indicates oversold conditions, and with McDonald's nearing this threshold, a recovery may be imminent [10]