Jim Cramer Is Watching McDonald's Investor Meeting on Tuesday
TheStreet's Jim Cramer will be keeping an eye on McDonald's (MCD) - Get Report when the company holds its big investor/analyst meeting on Tuesday. The focus will be on CEO Steve Easterbrook, who was appointed eight months ago. This will be his first strategic update.
"Easterbrook is the real deal," Cramer said. "I think he's going to lay out a multi-year strategy. I think that the stock is a buy both ahead and also after the meeting.
"Easterbrook's plan (for McDonald's is) to make it so that it's a simplified menu and they make fewer mistakes, which has really hurt them throughout," Cramer said. "It makes me feel like McDonald's could easily trade to $125 within the next year." McDonald's was trading at about $113 on Monday.
Shareholders will be anxiously awaiting updates on the restaurant's turnaround plan. In particular, they'll be focused on changes to the company's U.S. operations, plus technology initiatives and menu changes. They'll also want to hear what the company has to say about its real estate plans, as well as its refranchising efforts.
The fast food chain recently posted better-than-expected quarterly results. Shares of McDonald's are up more than 20% year-to-date.
TheStreet Quant Ratings rates McDonald's a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate.
The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, notable return on equity, expanding profit margins and good cash flow from operations.
We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated. Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key.
At the time of publication, Jim Cramer's charitable trust Action Alerts PLUS held no positions in stocks mentioned.