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MCD
#37
I would really hate to be MCD's management trying to figure out what the customer wants. Everyone complains about the low quality/taste of their food yet when they bring something better to market it gets ignored.

They had the Angus burgers which tasted pretty good, especially the swiss mushroom Angus burger. It was only about $5 IIRC. Didn't sell and was dropped from the menu. Their chicken wings were spicy enough to get your attention. Of course, at least around here, you couldn't get bleu cheese dressing to dip 'em in but still they didn't sell. The biggest complaint I read about was they were too spicy. Ha! Their full-size wraps are pretty good, especially the sweet chili, but again they aren't selling. The McRib's not bad but I'll bet if they kept it on the menu, people would get tired of it and it would be relegated to the dust bin. The Kids Meals sell because there's a toy inside -- not because of the wholesome meal their child is getting.

MCD's specialty is quick service food that gets rid of your hunger (or as I tell the wife, it makes a $%*#) and gets you on your way. You're not going to MCD for a special dinner with your date or family to enjoy a good meal or as a prelude to a night at the theater.

I think they need to simplify the menu to what they sell the best and offer seasonal specials such as the McRib or Shamrock Shakes. They also need to focus more on the franchisee's operations. Around here, most of the stores are the new format that offers a more relaxed atmosphere with subdued lighting at night. We have one that is the styled after the 70's restaurant but with a 50's drive-in motif with antique muscle cars parked outside (oh that old t-bird is pretty) and retro uniforms and posters inside. All are clean and well-maintained which speaks well to our local franchisor. Yet when I drive outside our local area I find many restaurants that are dirty, are in mediocre locations, have the late-90s/early-00 buildings and are slow to serve the customer.

I'm also so tired of the food nazis telling everyone what they should eat and drink. If you don't like it, don't go there.

There is a market for MCD. In the village my wife's business is located, they had a restaurant that opened that served specialty burgers, bison/elk/venison as well as prime beef, hand cut fries, hand made salads, etc. Prices were a little higher but not outrageous. We ate there a couple times and it was really tasty. It was located in a newly-built shopping center in the center of town with lots of parking. This village is not a bunch of poor people living outside a big city. It's a bedroom community where a lot of LMT, healthcare and insurance executives live and has an InBev plant in town. Yet within 3 years, they went out of business, and Mickey D's is still there with a steady stream of traffic.

I can't speak to outlets outside the U.S. but that's what I've noticed on the home front. So, all that to say they need to "stick to their knitting" and focus on operations.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan


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#38
My burger and fries from Five Guys cost under $8 and the fries are adequate for a group of 3-4. More importantly, the burger is delicious as opposed to dry and flavorless. Quarter pounder delux is the closest thing to a liittle burger. With large fry, is about a buck less than Five Guy meal, less the quality and flavor. To each his/her own.

MCD may transform itself yet again, but I'll pass. Too many barbarians at the gate, too much change in what consumers are demanding. If I own MCD it will be via an ETF which includes mostly big cap dividend payers.
Alex
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#39
I think all of your points are valid, Alex, and (if you believe the headlines, anyway) a lot of other people seem to agree. But no matter how much I read, I just can't bring myself to worry about MCD. Every time I look there are plenty of customers there, and eventually, they'll hit on a tweak to the formula that gets them back on track again (even if that means some variant on "back to the basics"). They've got top-notch real estate all over the planet, and the earnings lull and stock action just don't bear out the "McDonald's is doomed" story. Sometime in the next two to six years, the tide will turn and all we'll see are headlines praising MCD's execution, the share price will advance into the $120s, where it will "languish" for several years, at which point the doom-sayers can start all over again.

I could easily be wrong, of course, but this is my best guess!
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#40
(04-11-2015, 08:50 AM)Dividend Watcher Wrote: I can't speak to outlets outside the U.S. but that's what I've noticed on the home front.

Like clockwork, this and this show up. Given, the French lifestyle is a wee bit different from the U.S. but I'd like to see something like this here.
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Their coffee still sucks, though.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan


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#41
MCD always seems to be transforming itself as a company, they'll tear down and rebuild a restaurant in a heartbeat. They never seem content being on the sidelines, which is good. A lot of fast food chains have come and gone over the years while MCD has a proven track record. I very rarely go to McD's, if ever but one can't ignore it's history as a company. Easy, cheap, fast food and a known brand name.


The only fast food joint I go for is Chick Fil A, damn I love that spicy chicken sandwich!
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#42
More arguments for the doom and gloom crowd about MCD's future.
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#43
MCD up 3 percent this morning on absolutely terrible earnings of 84 cents for Q1 2015 -- not even enough to cover the dividend. The story for the pop seems to be excitement about MCD's intention to take more risks and the planned unveiling of a "turnaround plan" on May 4. I'm completely skeptical about those -- they sound like the actions borne of desperation and panic (and shareholder PR) more than careful planning. But I'll try to suspend judgment until we see what the "plan" entails. Meanwhile, I remain confident that in the long term, MCD and its shareholders will be just fine.
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#44
The earnings were so bad that I saw this verbiage for the first time ever:

"McDonald's (NYSE:MCD): Q1 EPS of $0.84 may not be comparable to consensus of $1.06."

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#45
As a newbie... I'm so confused.
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#46
"Markets can remain irrational a lot longer than you and I can remain solvent."

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#47
What's going on with MCD? Up almost 3 percent. Started shooting up at about 1:30, but I'm not seeing any news.

Maybe a sympathy move on Red Robin's excellent results?
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#48
(05-19-2015, 01:35 PM)Kerim Wrote: What's going on with MCD? Up almost 3 percent. Started shooting up at about 1:30, but I'm not seeing any news.

Maybe a sympathy move on Red Robin's excellent results?

Cracker Barrel and YUM also doing well ... here's an interesting take on MCD as a real estate investment valuing the split company at about a 30% premium to today's prices

http://theconservativeincomeinvestor.com...nvestment/

There's been some very solid and consistent call options being bought on MCD for a month or two straight now ...

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