- Jefferies upgrades McDonald's (NYSE:MCD) to a Buy rating on confidence that the restaurant operator is well-positioned with its new digital and delivery programs.
- The investment firm thinks other fast-food chains may be scrambling to catch up to the technological lead struck by McDonald's with the new initiatives.
- "We find the combination of digital, remodels and delivery (with UberEats) will make a +3 percent U.S. same-store sales result very visible with potential upside depending on how quickly initiatives gain traction," writes analyst Andy Barish. "Additional efforts around national value (to come in early 2018), quality, premiumization (fresh beef in quarter-pounders, Signature Crafted), and beverages could layer additional sales," he adds.
- Also, the 95% mix of franchised outlets is seen by the Jefferies team as helping with operating margin expansion.
- The new price target from Jefferies of $200 on MCD is a Street high.
- Shares of McDonald's are up 1.38% in premarket trading to $173.00.
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Original article