McDonald's

McDonald's announced it will expand CosMc's, its spinoff beverage-focused concept, to additional test markets in Texas after the initial Bolingbrook Illinois location showed encouraging early results. The format targets the afternoon snack and drink occasion that has been dominated by Starbucks and Dutch Bros. McDonald's is essentially trying to compete in a higher-margin beverage daypart without cannibalizing its core burger business.

People forget that McDonald's doesn't really operate restaurants — it's essentially a real estate and royalty company that collects rent from franchisees on some of the best-located commercial properties in the world. The franchise model means roughly 95% of locations are franchisee-operated, which insulates corporate from most commodity cost swings. That structure is worth paying up for in a volatile food cost environment.

How are people thinking about the impact of GLP-1 drugs like Ozempic on McDonald's long-term demand? Some analysts are calling it a secular headwind for the entire QSR sector but others think the effect is overstated.

Does anyone have a good read on how the $5 Meal Deal performed relative to expectations over the summer? McDonald's extended it multiple times which could mean it was driving traffic or could mean franchisees just didn't want to lose the promotional halo.

Same-store sales in the US went negative in Q3 2024 for the first time in years and management blamed the E. coli outbreak linked to slivered onions on the Quarter Pounder. That's fine as a one-time hit but the real issue is that the low-income consumer was already pulling back before the outbreak even happened. You can't paper over a value perception problem by just running a McValue menu and hoping it sticks.

At roughly 23x forward earnings McDonald's is priced like a growth company but it's posting negative US comps and facing real franchisee profitability stress. The stock has underperformed the S&P for the past eighteen months and I think the multiple compression has further to go before the value thesis becomes compelling again. Yum Brands is doing more interesting things internationally at a cheaper valuation.

International operated markets have been a consistent drag with weak performance in Germany and France where the consumer environment is brutal and local competition from Quick and other regional chains is intensifying. Adding that to soft IOM comps and you realize the bull thesis is basically pinned entirely on the US recovery, which itself is uncertain.

McDonald's settled litigation with former CEO Steve Easterbrook for approximately $105 million after clawing back his severance over concealed relationships with employees. The resolution closes a chapter that raised serious governance questions about the board's oversight during his tenure. McDonald's had originally paid Easterbrook a $40 million exit package before the misconduct details came to light.

The Chicken Big Mac rollout in the US is interesting timing — McDonald's is clearly trying to capitalize on the years-long chicken sandwich wars that Popeyes essentially ignited in 2019. The question is whether chicken sandwich innovation actually moves the needle anymore or if the category has matured to the point where it's just table stakes.

McDonald's guidance for 2025 targets over 2,200 net new restaurant openings globally, which is a serious acceleration in unit growth. A lot of that is coming from China where the Carlyle-backed Cangyan structure is investing heavily in tier-2 and tier-3 cities. When you're adding units at that pace in underpenetrated markets the royalty stream compounding is significant over a five-year horizon.

McDonald's loyalty program now has over 150 million active users globally and that number keeps climbing. When you have that kind of direct relationship with customers baked into the app, you're building a data moat that Wendy's and Burger King simply can't replicate at scale. The digital ordering mix driving higher average check sizes is exactly the kind of structural margin improvement that deserves a premium multiple.