MCD Stock: 25% Upside Potential with This High-Yielder?
November 12, 2025
Wall Street Expects MCD Stock to Hit Record Levels
In the income stock spotlight today? MCD stock.
The U.S. and global restaurant industries have seen some volatile times over the last number of years. In 2019, the year before the 2020 health crisis, U.S. restaurant industry sales hit a record $863.0 billion. (Source: “U.S. Restaurant Industry Finished The Year $240 Billion Below Pre-Pandemic Sales Estimates,” Forbes, January 21, 2021.)
They were expected to top that in 2020. That clearly didn’t happen. In 2020, sales tumbled to $659.0 billion. Not a big surprise really; the forced closure of restaurants will do that to sales.
Since then, the U.S. restaurant industry has staged a remarkable recovery. In 2022, sales hit a record $898.0 billion. In 2024, U.S. restaurant sales topped $1.1 trillion. In 2025, they are projected to hit $1.5 trillion. (Source: “State of the Restaurant Industry 2025,” National Restaurant Association, February 5, 2025.)
One restaurant stock that continues to do well, in spite of tariff talk and concerns of a recession, is McDonald’s Corp (NYSE:MCD). On March 10, MCD stock hit a record high of $326.32. It has meandered a bit since then with support near $294.55 and resistance at $300.05.
Wall Street Anticipating Record Highs
As of November 10, MCD stock is trading near that resistance level, putting the stock up slightly more than five percent year to date. Despite concerns about an economic slowdown, the outlook for MCD stock remains robust.
Since McDonald’s reported solid third-quarter results, most Wall Street analysts have reiterated their “Buy” ratings on MCD stock, with a one-year target range of $323.79 to $375.00 per share. This points to potential gains of approximately eight percent to 25%. Hitting the latter of course would put MCD well into fresh record territory.
Chart courtesy of StockCharts.com
About McDonald’s Corp
McDonald’s is the world’s leading global foodservice retailer with over 44,000 locations in over 100 countries. Approximately 95% of McDonald’s restaurants worldwide are owned and operated by independent local business owners. (Source: “Investor Overview,” McDonald’s Corp, November 10, 2025.)
Every day, the fast-food restaurant serves approximately 70 million customers, with the company employing more than 2.2 million people. Incredibly, one in eight Americans has worked at a McDonald’s restaurant.
All McDonald’s patrons are familiar with the “Big Mac,” but because of the company’s huge international presence, it also serves locally relevant food and beverage options. In Atlantic Canada and New England, you can enjoy a “McLobster;” in India, it’s a “McAloo Tikki;” or you can grab a chocolate croissant or beer if you’re in France.
The company’s main segments are United States, International Operated Markets (IOM) and International Developmental Licensed Markets & Corporate (IDL).
The U.S. segment focuses on McDonald’s menu and offerings, as well as its delivery and digital platforms.
Its IOM segment includes its operations in markets such as Australia, Canada, France, Germany, Italy, the Netherlands, Russia, Spain, and the United Kingdom.
McDonald’s IDL segment encompasses its operations in markets such as Latin America and Asia. Digital offerings in this area include drive-thru, takeaway, delivery, curbside pick-up, and dine-in.
Back in November 2020, McDonald’s launched a new initiative, the “Accelerating the Arches” program. This program focused on modernized marketing; a renewed commitment to the company’s core products of burgers, chicken and coffee; and a focus on the “four D’s”: digital ordering, delivery, drive-thru, and development. (Source: “Accelerating the Arches,” McDonald’s Corp,” last accessed November 10, 2025.)
The company saw immediate results. By 2022, systemwide sales surged by ~$20.0 billion; placing McDonald’s in its strongest position in years.
In December 2023, McDonald’s unveiled “Accelerating the Arches 2.0.” The upgraded business plan included accelerating new store openings to capture increased demand. The company’s looking to expand to 50,000 restaurants by 2027, up from 43,500 today. (Source: “McDonald’s unveils Accelerating the Arches 2.0,” Food Business News, January 12, 2023.)
More broadly, Accelerating the Arches 2.0 is focused around M-C-D: maximizing marketing, committing to the core products, and doubling down on the four Ds of delivery, digital, drive-thru, and development.
Robust Third-Quarter Results
On November 5, the world’s largest restaurant chain reported third-quarter results for the period ended September 30, 2025. Total revenue increased three percent to $7.0 billion, with same-store sales growing 3.6%. (Source: “McDonald’s Reports Third Quarter 2025 Results,” McDonald’s Corp, November 5, 2025.)
U.S same-store sales rallied 2.4%, topping Wall Street expectations for 1.9%. Growth came primarily from higher average checks as customers paid more per order. The International Operated Markets division, which includes Canada and Australia, reported 4.3% in same-store sales growth. Its International Developmental Licensed Markets advanced by 4.7%.
This signals that the company continues to do better than its peers in a slowing consumer environment and amid tough “value wars” across the fast-food industry.
McDonald’s third-quarter earnings inched up two percent (flat in constant currencies) to $2.2 billion, or $3.18 per share. Its adjusted earnings were flat at $3.22 (a decrease of one percent in constant currencies). Wall Street was looking for adjusted earnings of $3.33 per share.
Chris Kempczinski, the company’s chairman and chief executive officer, noted, “We’re fueling momentum by delivering everyday value and affordability, menu innovation, and compelling marketing that continue to bring customers through our doors.”
Kempczinski called McDonald’s third-quarter performance, “a testament to our ability to deliver sustainable growth even in a challenging environment.”
MCD Stock: Dividend Upped for 49th Straight Year
In late October, McDonald’s board announced that it had increased MC stock’s quarterly payout by five percent to $1.86 per share, or 7.44% on an annual basis, for a current forward yield of 2.5%.
This represents the 49th consecutive year in which McDonald’s has increased its annual dividend. Barring anything utterly unseen, by this time next year, the company will hit the 50-year mark, making it a Dividend King.
Very few companies can lay claim to this title; just 56 companies are currently labeled as Dividend Kings.
Reinvesting dividends in a stock like MCD stock can really illustrate just how much compounding impacts returns. McDonald’s has raised its annual dividend every year since 1976.
Since that year, MCD stock has provided total returns of 65,270%! Had an investor elected to take their quarterly payouts and run, their total return would fall to 1,302%.
The Lowdown on MCD Stock
McDonald’s is the largest restaurant owner-operator in the world, with 2024 system sales of $130.0 billion across more than 43,000 stores and more than 100 markets.
The company, which pioneered the franchise model, has built an impressive footprint through partnerships with independent restaurant franchisees around the world. Thanks to this set-up, it earns more than 60% of its revenue from franchise royalty fees and lease payments, with the bulk of the remainder coming from company-operated stores.
McDonald’s should be able to maintain its market share through its M-C-D framework and its Accelerating the Arches 2.0 strategy.
This should enable the company to be faster and more innovative and efficient and result in continued strong financial results, long-term capital appreciation, and a growing annual dividend payout.
