McDonald’s (MCD) This fall 2020 earnings

People wear protective face masks outside McDonald’s in Times Square as the city resumes Phase 4 reopening after restrictions were imposed in New York City on September 18, 2020 to slow the spread of the coronavirus.

Noam Galai | Getty Images

McDonald’s is expected to report its fourth quarter earnings before the bell on Thursday.

Wall Street analysts surveyed by Refinitiv expect the following:

  • Earnings per share: $ 1.78 expected
  • Revenue: $ 5.37 billion expected

In November, the company announced to investors that it is targeting mid-single-digit sales growth in 2021 and 2022. The fast food giant is moving towards meat substitutes and chicken, leveraging more collaborations with celebrities and launching a loyalty program in the US to fuel growth as the effects of the coronavirus pandemic linger.

However, investors are likely to be interested in the company’s shorter-term projections. The distribution of vaccines, expanded lockdowns in Europe and new government policies under President Joe Biden could have a significant impact on their results this year.

However, compared to the broader U.S. restaurant industry, McDonald’s and its fast food counterparts have recovered quickly from the pandemic. Convenient thoroughfares, low prices, and a menu full of comfort groceries have brought customers back to their restaurants. Last quarter, McDonald’s saw sales in its home market grow 4.6% in the same store, despite increased pressure outside of the US.

But the rapid recovery in US sales has not deterred McDonald’s management and franchisees from feuding. Operators’ complaints to the company include that franchisees are being asked to pay higher fees for technology investments and that a decade-long subsidy for Happy Meals is being terminated. As part of their revolt, the franchisees plan to defend themselves against future added value and to re-examine those already decided for 2021. The operators have also stopped any “non-essential” communication with the company.

McDonald’s shares were roughly unchanged over the past year, equating to a market value of $ 161 billion.

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