Evercore ISI's David Palmer: Here's what McDonald's needs to focus on in the second half

McDonald's Financial Performance & Strategy - McDonald's served up an earnings beat, with EPS and revenue ahead of expectations [1] - Global comps were up [1] - McDonald's needs to focus more on value for 50% of their US business that isn't tapping into digital value or existing $5ish meals [2] - McDonald's is aiming for a value perception [3] - The introduction of the $2.99 snack wrap on July 10 led to comps being up mid-single digits since then, locked in for the rest of the year [6] Competitive Landscape & Consumer Behavior - Fast casual is slowing, while casual dining is showing remarkably strong results [4] - Chili's is poking fun at McDonald's burger prices, highlighting their 1099 three for me deal [5] - Chipotle doesn't do advertised price points, maintaining inherent value like Texas Roadhouse [8] - QSR needs to show it can survive and coexist with McDonald's, and is currently doing well [12] Inflation & Beef Prices - McDonald's over-priced during COVID, outpacing wage growth [9] - Beef inflation in Europe, where McDonald's has 70% of its company stores, was a remarkable 20% [15] - Relief on beef prices is expected to take one to two years [16]