McDonald's (MCD) Continues To Dominate In The Recession

By: Greg Feirman Thursday, October 22, 2009 2:41 PM

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McDonald's (MCD) this morning reported another excellent quarter. Global same store sales increased 3.8% compared to the year ago period including gains of 2.5% in the US, 5.8% in Europe and 2.2% in Asia, the Middle East and Africa. That's some solid sales growth in this environment. Net Income was up 6% and EPS 10% as they bought back 3.3% of outstanding shares over the last 12 months. They are going to earn about $4 a share this year so at the current $60 price that's a 15 multiple on current earnings - not expensive at all. They also raised their quarterly dividend to 55 cents for a 3.67% yield. This is a good stock and one that I'm interested in owning in the low $50s.

Notably, McDonald's stock has only rallied about 18% since the March low - far below the overall move in the S&P. This rally doesn't seem all that interested in quality stocks.

Disclosure: Top Gun has no position in McDonald's (MCD) shares.

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