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McDonald's?
Old 02-06-2019, 02:41 PM   #1
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McDonald's?

No, I'm not hungry. What are you thoughts on McDonald's as an investment? Potentially a good global recession proof stock.

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Old 02-06-2019, 03:30 PM   #2
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I own it and intend to hold it. It’s done well since I bought (2015) but I consider it more as a widows and orphans type for the future.
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Old 02-06-2019, 03:34 PM   #3
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I have a few shares, and it's done pretty well, but I don't know if I'd call it "recession proof". It took a pretty big hit from around November, 1999 when it peaked out around $45/share, dropping to around $13-14 in early 2003. At least, according to the chart on Yahoo Finance.


I forget now when I first bought it, but I remember it had been because of a pretty high dividend. Maybe around 2005-2006, I think? But at some point, the dividend was either cut, or the share price went up faster, so the yield didn't keep up. I want to say it was paying around 4-5% at one point.


It did weather the Great Recession relatively well, though. It peaked out around $65/sh in August of 2008, and the lowest it got to was around $52. It did that several times, including around the March 9, 2009 official bottom.


But, it's around $175 today, and has a yield of around 2.6%. So, it's done pretty good. The dividend has also been pretty consistent about going up every year, too.
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Old 02-06-2019, 05:22 PM   #4
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I have a few shares, and it's done pretty well, but I don't know if I'd call it "recession proof".

I think that’s right. I have it classified as consumer discretionary, so if something major hits the consumer... but it’s not exactly high-end.
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Old 02-06-2019, 06:37 PM   #5
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I worked at McD's in the early 70's when a franchise fee was about $125K, and was quite profitable for owners. Back then I marveled at all the people that ate this crap food. In the decades since, I have mistakenly predicted the financial demise McD, BK, Taco Bell, and KFC for decades.
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Old 02-06-2019, 06:51 PM   #6
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I worked at McD's in the early 70's when a franchise fee was about $125K, and was quite profitable for owners. Back then I marveled at all the people that ate this crap food. In the decades since, I have mistakenly predicted the financial demise McD, BK, Taco Bell, and KFC for decades.
There is just no accounting for bad taste

Actually, I love it when traveling, last thing I want is to stop at some diner and get slow service, or food poisoning, or weird stuff, at least at McD's it's pretty consistent.
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Old 02-06-2019, 06:54 PM   #7
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Actually, I love it when traveling.
Me too. I rarely eat there but I really appreciate the ubiquitous clean bathrooms conveniently located at highway interchanges.
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McDonald's?
Old 02-06-2019, 06:56 PM   #8
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McDonald's?

When driving cross country alone, and with lots of miles to cover each day, I have my own MacDonalds method. Drive about two hours, stop at next MD, get one coffee and one $1 menu food item, stretch legs, use bathroom, use WiFi if necessary. Rinse and repeat. Amazingly I can go for 8 to 12 hours comfortably when I do this.
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Old 02-06-2019, 07:16 PM   #9
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Consider:

Analysts predicted Chipotle would be the death of McDonald’s. They were wrong. [but] "while McDonald’s and other fast-food chains may be on top now, it’s far too early to declare their victory over the rest of the restaurant sector."

And today's news:

Chipotle shares jump after company crushes earnings estimates...
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Old 02-06-2019, 07:26 PM   #10
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I haven't been to McDonalds since they did away with the HighC orange drink.

I only invest in things I enjoy!
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Old 02-06-2019, 07:32 PM   #11
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I rarely eat there but I really appreciate the ubiquitous clean bathrooms conveniently located at highway interchanges.
We were once running through a part of Asia where the public restrooms were, uhhh....holes in the ground.

DW really, really needed a bathroom and lo and behold, McD's was around the corner with an awesome bathroom. She still talks about how clean it was; complete with the ubiquitous electric toilet seat.
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Old 02-06-2019, 07:44 PM   #12
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I do recall that skipping high school lunch and jumping in anyone’s car with the company of some girls was reason enough to head for the golden arches.
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Old 02-06-2019, 08:08 PM   #13
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There is just no accounting for bad taste

Actually, I love it when traveling, last thing I want is to stop at some diner and get slow service, or food poisoning, or weird stuff, at least at McD's it's pretty consistent.
+1
I was sent to the UK and Amsterdam for a couple months. Even though I loved the native foods every week I'd do McDonalds. Pretty consistent except for the ketchup and green sauce in Amsterdam.
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Old 02-06-2019, 08:15 PM   #14
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I really wanted to order a “Royale With Cheese” and took the opportunity when it arose.
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Old 02-06-2019, 08:19 PM   #15
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+1
I was sent to the UK and Amsterdam for a couple months. Even though I loved the native foods every week I'd do McDonalds. Pretty consistent except for the ketchup and green sauce in Amsterdam.
We lived in France for a number of years. Every few weeks we'd get a hankering for 'home' and head to "McDoh" as they called it.
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Old 02-06-2019, 11:53 PM   #16
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With respect to the Chipotle factor, my opinion is skewed because locally with minimum wages going up, McD (and other fast food) prices have crept up also. A burger combo at McD runs around $8-9. At that price, I'd rather pay a dollar more and have a burrito bowl at Chipotle and glass of water. If I do eat at McDonalds, I'll using grab an item off the extra value menu.

I don't expect McDonalds to run into major trouble but as/if they start to get more into the fast casual pricing, I do think it will be a headwind.
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Old 02-07-2019, 12:23 AM   #17
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+1
I was sent to the UK and Amsterdam for a couple months. Even though I loved the native foods every week I'd do McDonalds. Pretty consistent except for the ketchup and green sauce in Amsterdam.
Last year, DW & I were in Vienna, had just done a walking tour and wanted to catch the subway to go to the summer palace.
So we wanted a quick bite, and right there in a historic area was McD
So we went in, and how lovely the computer order kiosks were there, so we pick English and order.
The place was FULL and crowded with locals !!
I guess all the tourists were eating at the local restaurants.
Some local fellow, started talking to us, and we had a nice conversation while waiting for food to be ready to pickup at the counter.
Upstairs they had a fancy coffee station/shop so we got a very nice coffee and pastry, as well, all part of McD, but with a slant localized for Vienna.
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Old 02-07-2019, 12:27 AM   #18
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No, I'm not hungry. What are you thoughts on McDonald's as an investment? Potentially a good global recession proof stock. [mod edit]
"global recession proof stock " No such thing exists , except maybe Tobacco companies. That being said, it's one of the few in the restaurant franchise businesses proven as a consistent money maker for over 60 years.



Pssst - Here is a tip : Don't eat the food, but say '"Senior Coffee"at the counter
just that phrase will yield a significant return on investment. Use the same tip at Wendy's and Jack in the box.
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Old 02-07-2019, 06:59 AM   #19
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A little bit older article about McDonalds embracing AI.

https://www.forbes.com/sites/edrensi.../#1b7dfb166f14

Some more recent stories offer a future outlook of the trim down of costs, through automated on-call cooking, serving and generation of services at all levels. Imagine a full service Mcdonalds operated by three or four employees.

The broader message is in the long term planning for all labor intensive businesses. As change occurs many will fall by the wayside. Watch for corporation investment plans as an indicator of longer term viability and profitability
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Old 02-07-2019, 08:31 AM   #20
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As an investment it may be great but I haven't graced the door to a McD in over 25 years. I'm sure they have missed me
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