McDonald's shares are up in early trading, making a new 52 week high at 101. The company announced a plan to close more stores than it opens - and investors seemed to like the idea. The question for holders of this stock, which has been in a trading pattern for three years - is this time for real? Can the company break from this range or will this be yet another opportunity to sell a few shares for profit and wait for the inevitable sell-off to buy back in?
I do not like the results McDonald's has been posting of late, with most of the recent quarters showing declining sales and profits. It's true that even with those declines the company has a strong balance sheet, but at a stock price of 101, the price to earnings ratio or PE, is close to 24 - not cheap and I would *NOT* purchase new shares at this level.
I am of the camp to hold. If you want to sell a few shares here to book profits, be my guest. Nobody ever lost money taking profits in a stock with recent performance such as MCD (the stock has gone nowhere in three full years).
Short term rating = HOLD
Long term rating = HOLD
I do not like the results McDonald's has been posting of late, with most of the recent quarters showing declining sales and profits. It's true that even with those declines the company has a strong balance sheet, but at a stock price of 101, the price to earnings ratio or PE, is close to 24 - not cheap and I would *NOT* purchase new shares at this level.
I am of the camp to hold. If you want to sell a few shares here to book profits, be my guest. Nobody ever lost money taking profits in a stock with recent performance such as MCD (the stock has gone nowhere in three full years).
Short term rating = HOLD
Long term rating = HOLD