Why should I trade McDonald’s shares?

McDonald’s is the largest fast food company in the world, and one of the most recognizable brands in the world as well. No matter where you go you are almost certain to be able to find a McDonald’s restaurant nearby. The stock is also quite popular among traders, with millions of shares exchanging hands on a daily basis. That popularity gives the stock great liquidity, and enough price action for any trader to potentially profit from a trading strategy centred around McDonald’s shares. If you want a way to trade on the restaurant sector McDonald’s is one of the largest and best-known shares to trade.

Is McDonald’s the best restaurant stock for trading?

With so many different restaurant stocks available, and market conditions always changing, the best restaurant stock for traders is also always changing. Oftentimes some newsworthy event is the catalyst that sparks a rally or a drop in shares, and can determine the best restaurant stock for trading. Other times it is the trends and growth in one company over the other. However, through it all McDonald’s has been a solid choice for traders, with an uptrend in shares that’s lasted for nearly two decades. That may not make it the best, but McDonald’s sure is a good restaurant stock for all types of traders.

What’s the best strategy for trading McDonald’s shares?

Because McDonald’s shares have been in an uptrend for almost 20 years the best strategy has obviously been a trend following strategy that looks to buy when the stock is experiencing some troubles. Any pullback in shares or dips on poor quarterly earnings has proven to be a good chance to buy McDonald’s stock at a lower level in preparation for later gains. Because there have also been periods of consolidation in the stock a breakout strategy can also work well when you notice shares turning sideways for several weeks or months.

McDonald’s Stock

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McDonald’s is easily one of the most recognisable brands, with the company being one of the largest fast-food chains in the world as of 2020. The company was founded by siblings, Richard and Maurice McDonald, on May 15^th, 1940. The restaurant operated as a popular hamburger stand and laid the foundations of the mammoth global company well known around the world today. McDonald’s is headquartered in Chicago, Illinois, and has operations throughout the world, with its golden double-arch logo a symbol of the globalisation and transition of the American lifestyle. McDonald’s introduced the ‘Speedee Service System’ that forms the basis of how fast foods operate to date – a quick-service system that eliminated the need for waiters and waitresses. But, while the McDonald brothers are credited with this innovation, it was the milkshake machines salesman, Ray Kroc, that saw the true potential of the restaurant model.

After being amazed by how a single restaurant bought and operated multiple milkshake machines, Kroc joined the company as a franchisee and was incorporated into the McDonald’s Corporation in 1955. Kroc eventually edged out the McDonald brothers and took charge of expanding the company domestically and internationally. By the end of the 1960s, McDonald’s operated over 1,000 restaurants, and before the end of the 1980s, the number topped 10,000. Exponential growth continued in the 1990s, and by the turn of the millennium, McDonald’s had a presence in over 100 countries, operating over 35,000 restaurants. In the late 1990s and early 2000s, McDonald’s sought to diversify its business and acquired notable brands around the world, such as Chipotle Mexican Grill, Aroma Café, Boston Market and Donatos Pizza.

Nonetheless, the company had, by 2008, made divestitures in almost all those and other companies, focusing instead on strengthening and promoting its own brand. The company is one of the largest private employers in the world, and in addition to its trademark hamburgers, it has in its menu a wide variety of value-priced products. McDonald’s has adapted brilliantly to the needs of the modern-day ‘eater’, incorporating healthy products as well as efficient home delivery services. The company went public in 1965 and is listed on the NYSE where it trades under the ticker symbol MCD. It falls in the Consumer Cyclicals sector, under the Restaurants industry.

MCD Stock History

There were 10 splits for the McDonald’s stock before 1990, a representation of a period where the company experienced phenomenal growth. Since then (up till September 2020), there have only been 2 splits as follows: a 2-for-1 on June 7^th, 1994; and a 2-for-1 on February 12^th, 1999. In the early years, McDonald’s sought to split when its stock was about to hit triple digits, with the company keen to remain attractive in the retail investment community. With discount brokers available nowadays, the company may see no need to place a stock split on its menu.

Adjusted for splits, the McDonald’s stock rose from a price of circa $1 to trade at circa $50 towards the end of 1999. The turn of the millennium saw the stock retrace its multi-year gains, bottoming out at circa $13 by February 2003. Since then, the stock has drifted higher and higher, printing an all-time high at circa $225 in September 2020. McDonald’s operates a cash flow heavy business and has over the years been one of the consistent biggest payers of dividends. In fact, McDonald’s has, at one time, been named as one of the S&P 500’s ‘dividends aristocrats’.

How to Trade MCD Stock

McDonald’s has often been one of the most attractive stocks on Wall st. Here are some of the factors to consider when trading the stock:

Legislative and Taxation Policy
The food industry has, in recent years, been a target of inflation and taxation policies, with governments pushing companies towards the production of healthy products that are safe for consumers. For a company as big as McDonald’s, the huge number of employees leaves the company vulnerable to changes in taxation policies as well.
Trade and Tariffs Agreements
McDonald’s has operations in multiple countries, and sometimes, it ships some of its ingredients all around the world. Trade and tariff agreements between various jurisdictions could have a significant impact on the company’s overall revenues and margins.
Stiff Competition
Granted that McDonald’s is a top player in its industries, they still have various major competitors such as Starbucks and KFC. The company also faces competition from several other small restaurants that offer dynamic, localised menus to their clients.
Lawsuits and Negative PR
McDonald’s has, over the years, faced multiple challenges to its overall image. From unhealthy foods and low paying jobs to controversial spending and animal welfare. The company, has for many years, battled to maintain a clean public image. Lawsuits and negative PR can supply headwinds to the stock of a company. even despite overall positive fundamentals.
New Product Rollout
McDonald’s has throughout its history introduced best-selling products such as the Big Mac, Egg Muffins, Chicken McNuggets and the McGriddles Sandwich. Hit products often inspire higher stock prices, whereas misses can prove a heavy load on the stock.
Periodic Earnings Reports
McDonald’s fiscal year runs from January to December and the company releases quarterly and annual corporate reports to keep investors and shareholders updated on its business performance. Typically, positive numbers will inspire higher stock prices, whereas negative figures can drag the stock lower.

AvaTrade MCD Stock Trading Information

MT5/MT4 Symbol: #MCDONALDS
Trading Hours: Monday – Friday (GMT) 13:30 – 19:59
Country: US
Currency: USD
Exchange: New York Stock Exchange
Typical Spread: 0.13%
Units: Share
Minimum Trade Size: 10*
Leverage:

Why Trade MCD Stock with AvaTrade

Here is why you should consider trading the McDonald’s stock with AvaTrade:

Global Brand
AvaTrade is a reputable and trustworthy broker that is regulated in 7 jurisdictions around the world. Trade MCD and other assets in a transparent environment, with maximum safety and security.
Leverage Trading
Trade MCD stock with a leverage of up to on AvaTrade and expand your trading activities.
Go Long or Go Short
Trade McDonald’s stock as a CFD and find trading opportunities in both rising and falling markets.
Trading Conditions
Trade MCD stock and enjoy transparent prices, competitive spreads and rapid execution of all orders at all times. *This stock is available for trading with 0.001 lots.
Comprehensive Resources
Enhance your trading activities by utilising the comprehensive trading resources available at AvaTrade. Access our handy education section and economic calendar. Plus, take advantage of the exclusive AvaProtect risk management feature to manage your exposure and risks.

Mcdonalds Stock FAQ

Why should I trade McDonald’s shares?
McDonald’s is the largest fast food company in the world, and one of the most recognizable brands in the world as well. No matter where you go you are almost certain to be able to find a McDonald’s restaurant nearby. The stock is also quite popular among traders, with millions of shares exchanging hands on a daily basis. That popularity gives the stock great liquidity, and enough price action for any trader to potentially profit from a trading strategy centred around McDonald’s shares. If you want a way to trade on the restaurant sector McDonald’s is one of the largest and best-known shares to trade.
Is McDonald’s the best restaurant stock for trading?
With so many different restaurant stocks available, and market conditions always changing, the best restaurant stock for traders is also always changing. Oftentimes some newsworthy event is the catalyst that sparks a rally or a drop in shares, and can determine the best restaurant stock for trading. Other times it is the trends and growth in one company over the other. However, through it all McDonald’s has been a solid choice for traders, with an uptrend in shares that’s lasted for nearly two decades. That may not make it the best, but McDonald’s sure is a good restaurant stock for all types of traders.
What’s the best strategy for trading McDonald’s shares?
Because McDonald’s shares have been in an uptrend for almost 20 years the best strategy has obviously been a trend following strategy that looks to buy when the stock is experiencing some troubles. Any pullback in shares or dips on poor quarterly earnings has proven to be a good chance to buy McDonald’s stock at a lower level in preparation for later gains. Because there have also been periods of consolidation in the stock a breakout strategy can also work well when you notice shares turning sideways for several weeks or months.