I read an article posted at Business Insider on Friday, linked by a Facebook Friend, with the title of
McDonald's franchisees say the brand is in a 'deep depression' and 'facing its final days'
When I clicked on the article, before I read it - the title suggested to me McDonald's in danger of going out of business. The article then leads with the above mentioned quotes in the title and also the unsubstantiated stat offered by a franchise operator that 'Probably 30% of operators are insolvent.'
All of this is scandalous and incendiary and I'm sure garnered a lot of hits. I saw dozens of mentions of this story on Facebook and Twitter. Many asked me (since I cover McDonald's on my stock page) - Is McDonald's going out of business?
This article is about click-bait journalism and not finance, so I won't drone on with figures and charts. I've posted my thoughts on McDonald's recent struggles as a company and outlined what I think management needs to do in order to right the ship. To state it simply, if you look at the balance sheet, there is no evidence that the company is in any danger of going out of business.
To lead with such a headline is misleading and nobody that researches the company's current state of affairs could possibly believe it. McDonald's booked 26 Billion in Revenues in the TTM (Trailing Twelve Months) - no matter its troubles, this company is going nowhere.
I'd wager the author of the article knew that, but journalism wasn't the goal of this piece. An incendiary title meant to gather hits was the obvious purpose. This is demonstrated by the author casually tossing in at the end of the article that some operators aren't unhappy with the current CEO's efforts, giving those opinions no play compared to the operator that had dire things to say about the company. Operators that didn't share the opinion of the sensational headline were treated as an afterthought.
This is not a balanced article meant to inform you of the current state of McDonald's as a company. It's click bait, pure and simple. We must reject click-bait journalism and call out sub-par reporting. Please demand more from journalists.