Can McDonald's Stock Deliver In Its Next Earnings?

Core Insights - McDonald's is expected to report fiscal Q2 earnings on August 6, 2025, with analysts predicting adjusted earnings of $3.14 per share and revenue of $6.7 billion, reflecting a 6% year-over-year growth in earnings and a 3% increase in sales compared to the previous year [2] - The company is facing macroeconomic challenges and weak U.S. traffic but anticipates recovery driven by value pricing, menu innovations, and favorable currency exchange rates [3] - McDonald's has reaffirmed its full-year goals and expects a gradual rebound in Q2 and beyond, with a current market capitalization of $217 billion and revenue of $26 billion over the past twelve months [3] Earnings Performance History - Historically, McDonald's stock has underperformed after earnings announcements, with a decline observed 53% of the time and a median one-day decrease of 0.6% [2] - Over the past five years, there have been 19 earnings data points for McDonald's, with positive one-day returns occurring approximately 47% of the time, dropping to 45% in the last three years [5] - The median of positive returns is 2.7%, while the median of negative returns is -0.6% [5] Trading Strategies - Event-driven traders may benefit from historical trends by timing their trades around earnings announcements [4] - A lower-risk strategy involves assessing the correlation between short-term and medium-term returns after earnings, allowing traders to take positions based on favorable one-day returns [6] - The performance of peers can influence McDonald's stock reaction post-earnings, with pricing potentially starting before the earnings are reported [7]