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TheStreet Open House

McDonald's Needs to Focus on Fat

NEW YORK ( TheStreet) -- On Monday morning, McDonald's (MCD) posted third-quarter earnings that beat estimates by a penny but provided a lackluster same-store outlook for the fourth quarter.

While nothing incredibly optimistic stuck out from the report, it's likely that many shareholders are be becoming discontented with management's fumbling in the changing fast-food industry.

McDonald's has cited a poor economy and health trends for its slumping same-store sales figures.

The healthy trend is legit, taking away customers. But you would think that a poor economy would help a fast-food chain such as McDonald's.

Rather than fighting the healthy dining trend that has pushed stocks such as Panera Bread Company (PNRA) and Chipotle Mexican Grill (CMG) through the roof in recent years, McDonald's is joining it -- err, well sort of.

Putting fresh fruit and juice instead of fries and soda in Happy Meals is a noble idea. But while premium McWraps are probably tasty for some, the company is veering too far from its roots.

The adoption is not working. Consumers don't go to McDonald's for a berry salad and a smoothie. Why would they? If they want something like that, they can go to Panera or Potbelly (PBPB).

Maybe I'm the weird one, but I go to Mickey D's when I'm looking for a quick bite on the go, don't feel like spending money, or, quite frankly, am feeling guilty and craving a double cheeseburger and some fries. Maybe a McFlurry on the really guilty occasions.

And I think that's exactly the customer McDonald's should start to cater to once again: The value-oriented, non-health nut consumer looking for a quick bite.

Let's face facts -- someone who actually cares about their health isn't going to eat there. Not now, not ever.

It's got chicken wings, the value menu, salads, wraps, ribs, fish, premium burgers -- basically everything it seems like. What happened to the simple stuff?

The company tried to mix it up and offer healthy, premium food. But it's not working. It needs to scrap the whole thing. If management wants to do healthy, it will need to spin off a different chain under a different name.

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