McDonald's (MCD) by no means was immune from the wrath of Hurricane Harvey.
Credit Suisse analyst Jason West estimated the damage in a new note on Tuesday:
"Texas accounts for ~9% of MCD's US system store base. Assuming that ~25% of Texas stores are located in the greater Houston area (based on population mix) implies ~2% exposure to Houston. We est. a ~30bps drag on US system same-store sales from Hurricane Harvey in 3Q, based on the following assumptions: 1) ~2% of US system stores are in Houston, 2) stores were closed for ~5 days as a result of the hurricane (same-store sales down ~100%), 3) same-store sales remain severely depressed for the first ~10 days upon re-opening (down ~50%) and 4) same-store sales run down ~25% for the remainder of the quarter (~20 days). Gas prices have increased by ~7% over the past few days, which poses some risk to consumer spending power. That said, we have found that gas prices correlate strongly with restaurants same-store sales only during periods of extreme price changes (ex: late 2014/early 2015)."
McDonald's shares traded down 0.9% to $158.34 early Tuesday afternoon.
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