NEW YORK (TheStreet) -- BTIG has a "buy" rating and $137 price target on McDonald's (MCD) - Get Report stock after the fast food giant reported mixed 2016 second quarter earnings Tuesday morning, the firm's restaurant analyst Peter Saleh said on CNBC's "Power Lunch" Tuesday.
"Look it was a poor quarter, we can't sugarcoat it, but they are continuing to take a lot of market share," Saleh explained.
Before today's opening bell, McDonald's reported that second quarter same-store sales rose by 1.8% year over year, missing Wall Street estimates of a 3.2% growth. The company posted adjusted earnings of $1.45 per share on revenue of $6.26 billion, compared to the expectations of analysts surveyed by Thomson Reuters of $1.38 a share on $6.27 billion in revenue.
"The industry slowed. That does happen from time to time. Our sense is if we continue to create more jobs in this country, which we believe that's going to continue to happen, we should see another sales acceleration," he stated.
CNBC contributor Tim Love pointed out that when McDonald's all-day breakfast launched in October, the stock bounced and sales "surged," but that could have been a result of rival Chipotle MexicanGrill's(CMG) health scares.
"So, with those two things happening, you kind of saw a little bit more of a push at McDonald's than you really should have seen. Now the market is just settling and understanding what's happening," Love continued.
McDonald's needs a new initiative to "spark" its stock and sales in order to keep performing well against Chipotle, he commented.
Shares of McDonald's are slipping by 4.42% to $121.75 this afternoon.
Separately, TheStreet Ratings rated McDonald's as a "buy" with a score of B.
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. TheStreet Ratings feels its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
You can view the full analysis from the report here: MCD
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.