LiteForex - Analytics

    LiteForex

    805.00 7.50/10
    78% of positive reviews
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    Analytical review of McDonald`s Corp shares on 18.02.2016

    McDonald`s Corp., #MCD [NYSE]
    Services, Restaurants, USA

    Financial performance

    Index – DJIA, S&P 500;
    Beta – 0.49;
    Capitalization – 108.94 В;
    Assets profitability - 13.50%;
    Revenue - 4.53 B;
    Average volume – 7.04 М;
    P/E - 24.67; ATR – 2.52.


    Analytical review

    • The company has the 7th biggest capitalization in the service sector among the issuers listed on the US stock market.
    • At the end of January, the company provided a report on the 4th quarter 2015. According to the company's press release, its net profits grew by 10% from 1.1 billion USD to 1.21 billion USD during the period under report. EPS growth exceeded 15.5%, having risen from 1.13 USD to 1.31 USD.
    • At the press conference, the company's management announced that the revenue had dropped by 3.5% down to 6.3 billion USD due to the strong dollar.
    • To face ever growing competition from Shake Shack Inc. and Chipotle Mexican Grill Inc., the company extended the breakfast menu for the whole day in the USA, which allowed raising sales by 5%.
    • The company did not manage to increase its sale volumes in China last year. However, this factor rose by 3% in emerging markets.
    • Large investment funds and banks (RBC Capital, Argus, Deutsche Bank) forecast that the company's quotes will grow up to 130 USD.

    Summary

    • The Company's report on the 4th quarter 2015 has proved that the company's management has been working properly. Despite the strong dollar's pressure, the company has registered significant net profit and sale volume growth. Large investment funds forecast positive evolution of the company's shares.
    • Thus, we expect that the company's quotes will be rising in the nearest future.

    Trading recommendations for McDonald`s Corp CFDs

    Long-term trading:
    the issuer is currently trading between the support and resistance levels at 115.15-120.20 USD. Once the level of 120.20 USD is broken and tested, and relevant confirming signals appear (PriceAction patterns, for example), we recommend searching for market entry points to open long positions. Risk per trade: no more than 1.5% of equity. Stop order shall be placed a bit above the signal line. We recommend that prospective profits should be fixed partly at the levels of 124.50 USD, 127.00 USD, and 129.50 USD, with Trailing Stop applied.


    Short-term trading: the issuer has just broken a local resistance level at 118.50 USD on 15M time frame. Once this level steadies and signal formations appear, we advise you to search for market entry points to open long positions. Risk per trade: no more than 2% of equity. Stop order shall be placed at 117.35USD. We recommend that prospective profits should be fixed partly at the levels of 121.00 USD, 122.50 USD, and 123.50 USD, with Trailing Stop applied.



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