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McDonalds
Old 08-06-2011, 09:52 AM   #1
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McDonalds

I hate stocks.. all I ever do is loose money. But I have been traveling throughout Asia for the last 4 months and everywhere I turn McDonalds has a restaurant. I like the out-of-the-way places, and even in remote areas the McDonalds is serving to local people... of all nationalities. They love the place.

A lot of fast food restaurants have tried to spread through the global market, but none of them begin to compete with McD. A francise costs about a $$million to just get started + 9 months of training at Hamburger U. in the US. They are always testing and remodeling to look and taste fresh. The upper management must be incredible to keep every store looking spotless and modern.

The P/E is 17, so it is not a growth stock. But as long as some part of the world is growing, McD will be growing along with it. Anybody looking for a real solid stock that shakes off all the bad news coming from the US and just keeps on growing; you should give this stock a closer look.
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Old 08-06-2011, 12:08 PM   #2
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I believe you're right.
U.S. stores only account for 31% of their total revenue, and their growth has been higher in other countries for a long time. Despite having to deal with higher costs, they are certainly on the right track, IMHO.
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Old 08-06-2011, 12:30 PM   #3
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Making investment decisions on one variable (such as...I like their product and/or I see em everywhere) can get you in trouble sometimes. I'm not saying always, but sometimes it can.

Best to do some homework.

Regarding McD & China. Just be careful, because I think they might be raising rates in China to slow the economy down a tad.
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Old 08-06-2011, 01:10 PM   #4
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Originally Posted by TN_INVEST View Post
Making investment decisions on one variable (such as...I like their product and/or I see em everywhere) can get you in trouble sometimes. I'm not saying always, but sometimes it can.

Best to do some homework.

Regarding McD & China. Just be careful, because I think they might be raising rates in China to slow the economy down a tad.
My recommendation was based on a little deeper analysis than that. Here is some technical analysis: Stock:McDonald's (MCD) If you want diversification, having 32,000 locations in over 110 countries, while constantly remaining profitable is pretty impressive. The same logic applies to Coka Cola, J&J, P&G and others - all globally diverse and well managed - as borne out by the numbers.
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Old 08-06-2011, 01:35 PM   #5
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JNJ, KO, PG are all solid blue chips, pays out a reasonable dividend, good financial fundamentals, and unlikely to be at risk anytime soon. Of course, I could be wrong, and have been many times in the past. Caveat Emptor.

I intend to start buying some of these in the very near future. Probably accumulate about 200 shares of each company, and sit tight on the dividends.
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Old 08-06-2011, 01:57 PM   #6
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I hate stocks.. all I ever do is loose money.<> Anybody looking for a real solid stock that shakes off all the bad news coming from the US and just keeps on growing; you should give this stock a closer look.
Interesting. You say that all you ever do is lose money. Yet you are not asking a question, you are giving stock investing advice.

Ha
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Old 08-06-2011, 05:24 PM   #7
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Yea, the is like a warning label required by lawyers. I am no wildly successful stock picker, but with every mistake I have learned something. Pretty soon I should be smart enough to pick a winner. I just happen to think the sun and moon and stars are lined up on this stock... so I share with you my inspiration. (but it comes with a warning label, too)
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Old 08-06-2011, 06:49 PM   #8
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Interesting. You say that all you ever do is lose money. Yet you are not asking a question, you are giving stock investing advice.
It could make sense. If others take his advice, perhaps their loss will be his gain, and he can stop losing money.
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Old 08-06-2011, 08:55 PM   #9
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But I have been traveling throughout Asia for the last 4 months and everywhere I turn McDonalds has a restaurant. I like the out-of-the-way places, and even in remote areas the McDonalds is serving to local people... of all nationalities. They love the place.
Yep, the locals seem to love eating at McDonalds. I don't own the stock but if the market really tanks I may buy in.

By the way, KFC also seems to have many local (Asian) customers here in Thailand.
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Old 08-07-2011, 07:07 AM   #10
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Yea, the is like a warning label required by lawyers. I am no wildly successful stock picker, but with every mistake I have learned something. Pretty soon I should be smart enough to pick a winner. I just happen to think the sun and moon and stars are lined up on this stock... so I share with you my inspiration. (but it comes with a warning label, too)
And a fair amount of the "easy money" might have already been made with McDonald's stock (it's increased quite a fair amount relative to some of the other US stock market indices).
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Old 08-07-2011, 09:46 AM   #11
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I hate stocks.. all I ever do is loose money. But I have been traveling throughout Asia for the last 4 months and everywhere I turn McDonalds has a restaurant. I like the out-of-the-way places, and even in remote areas the McDonalds is serving to local people... of all nationalities. They love the place.

A lot of fast food restaurants have tried to spread through the global market, but none of them begin to compete with McD. A francise costs about a $$million to just get started + 9 months of training at Hamburger U. in the US. They are always testing and remodeling to look and taste fresh. The upper management must be incredible to keep every store looking spotless and modern.

The P/E is 17, so it is not a growth stock. But as long as some part of the world is growing, McD will be growing along with it. Anybody looking for a real solid stock that shakes off all the bad news coming from the US and just keeps on growing; you should give this stock a closer look.
As soon as the locals find out about how healthy McDonald's food is, I think they might reconsider their eager appetite for McFood.
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Old 08-07-2011, 10:02 AM   #12
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And a fair amount of the "easy money" might have already been made with McDonald's stock (it's increased quite a fair amount relative to some of the other US stock market indices).
Perhaps, but consider that only 30% of the business comes from the US. So you really have to look at it as an expanding global market stock, not as a domestic stock. As I said, I have traveled pretty extensively in Asia recently, and you often see McDonalds near other US and foreign franchise restaurants - the next rest of them look pretty shabby. McD has free WiFi in all the restaurants, always as a low priced special deal if you are not hungry or on a budget. It is constantly offering free gifts, like Coke drinking glasses, etc. The bathrooms are the cleanest, well maintained... and even the wall-hung, blow hand dryer really dries your hands! First time I've seen that.

24-hour operation, inexpensive home/hotel delivery, TV for all the popular sports events, free coffee refills... they just don't miss a beat.

It is the quintessential American efficiency in a business - and that impresses the hell out of all foreigners. And the profits come back to the US in the form of annual franchise fees, sales of all sorts of accessories to the restaurants, a share of the store profits and other things like store rent, etc. In other words, money flows back continuously to the US in the form of steady income. That is far different than selling IPhones where profit comes from a one-time sale.

I think I have almost convinced myself to buy some stock... Doh, I always have such bad luck in the stock market. I swore...never again...
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Old 08-07-2011, 10:28 AM   #13
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Yep, the locals seem to love eating at McDonalds. I don't own the stock but if the market really tanks I may buy in.

By the way, KFC also seems to have many local (Asian) customers here in Thailand.

I agree...MCD, YUM, DAR, SBK are all good companies that have plenty of room to grow overseas.

I just don't want to pay the price of any of them yet...maybe when the mkt is finished correcting I can get into one.
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Old 08-19-2011, 11:28 PM   #14
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I usually am more of a mutual fund investor, but I do have a small portfolio of individual stocks, and I've owned MCD for over a year now. Its been a winner so far and I don't intend to sell here. If it falls back at all I may pick up some more.

Very well run company in my opinion.
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Old 08-20-2011, 04:29 AM   #15
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It is quite interesting to travel around Asia and see which American companies are successful, and which ones haven't even entered the arena. Other examples include the usual suspects, Johnson & Johnson, and Proctor&Gamble. These companies have been around for a long time and use the established distribution network already available in Asia. Coke remains unsurprisingly strong; Caterpillar's success in a often told story. But all of those companies (with the exception of Coke), sell re-packaged traditional American products with a keen sense of marketing in other cultures.

McDonalds is in a highly competitive sector, but is constantly changing, improving its product and store while keeping quality up but prices low. I read where the company handles all aspect of the business - from choosing the right ingredients to printing banners. In some, more developed countries they have established a single production and distribution network within the country. Other areas must import their supplies. Quality control is the utmost importance. And I guess having the flexibility to customize the product to the fit the culture. Even the ever-present Ronald McDonald statue is customized to reflect the local culture.
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Old 08-20-2011, 11:35 PM   #16
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The past 2 weeks have brought MCD down a little ( still high though, compared to the price a year ago ), but unfortunately I missed the opportunity to grab some in the low 80's.

If, as I expect, we see more market declines over the next few weeks, I have entered a GTC order for buying a few hundred shares at $80 even. We'll see if it fills.
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Old 08-23-2011, 01:02 PM   #17
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My recommendation was based on a little deeper analysis than that. Here is some technical analysis: Stock:McDonald's (MCD) If you want diversification, having 32,000 locations in over 110 countries, while constantly remaining profitable is pretty impressive. The same logic applies to Coka Cola, J&J, P&G and others - all globally diverse and well managed - as borne out by the numbers.
I am long and a big fan of MCD

There is geographic diversification (MCD has it) and there is product diversification (MCD does not - while they change menus, people go to MCDs for MCDs!). As far as product line, they much more resemble KO then PG or JNJ - for better or for worse.
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Old 08-23-2011, 01:04 PM   #18
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I can't think of another company that has successfully "reinvented" themselves as many times as MCD. Somehow they find a way to make money no matter what happens..........
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Old 08-23-2011, 01:04 PM   #19
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JNJ, KO, PG are all solid blue chips, pays out a reasonable dividend, good financial fundamentals, and unlikely to be at risk anytime soon. Of course, I could be wrong, and have been many times in the past. Caveat Emptor.

I intend to start buying some of these in the very near future. Probably accumulate about 200 shares of each company, and sit tight on the dividends.
are you trying to say that MCD is not a solid blue chip (it is), does not pay out a reasonable dividend (it does), does not have good financial fundamentals (it does) and is likely to be at risk anytime soon (its unlikely)
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Old 08-23-2011, 01:22 PM   #20
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are you trying to say that MCD is not a solid blue chip (it is), does not pay out a reasonable dividend (it does), does not have good financial fundamentals (it does) and is likely to be at risk anytime soon (its unlikely)
Well, I didn't say that, I am one of those waiting in a 20 car deep drive-through for my large $1.00 coffee......... So I am assuming toher people think MCD is a good hold besides me.........
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