McDonald’s Surprising Uprise in Q3 – Should You Buy Stocks?

If you are an investor in the stock market, especially in stocks of restaurant chains, then you certainly know about the sudden rise of McDonald’s stock value in the 2015 third quarter. McDonald’s is recuperating and shows good revenue increase, exceeding revenue projections by 3.2% and beating expectations of earnings per share by 9.4%. Not only did sales rise by 4.6% in most leading European and American markets, but the Asian and other fast-growing markets posted a growth of 8.9%.

What Caused McDonald’s UpriseIn Q3 Of 2015?

In May, when McDonald’s CEO Steve Easterbrook took over the company, he released a public 23-minute video detailing exactly what was wrong with McDonald’s, and what he planned to do about it. This gloomy speech generated some mockery for his lack of passionate fire, and stock value went down by 1%.

Now, it is largely recognized that this CEO is one of the driving powers behind the radiant growth being seen today. According to Fortune Magazine, CEO Steve Easterbrook is known for his “activism” in restructuring the company. His rapid refranchising of 3,500 stores globally and the shut-down of 700 more shook up the company, and streamlined its management.

Other technical changes such as the proposed All-Day Breakfast, increases of food quality especially in Japan and China, and the maintenance of custom burgers in Australia have contributed to this surprising boost in sales. As investors regained trust in the company following these changes, the stock values increased.

Is the McDonald’s Uprise of Q3 Likely To Continue?

Easterbrook may be eyeing the rearrangement of the internal tax structure of the company, to lower the real estate tax burden on the company and the shareholders. McDonald’s has always been a trustworthy partner to its shareholders, and the lowering of taxes overall can only give them more dividends.

In addition, the prices of beef are dropping, due to the increase of herds of heifers for slaughter and their increasing health. If McDonald’s continues to buy its regular quota of $1 billion worth of beef every year, the lower prices will only continue to benefit the company and its growth in future years.

What Factors Could Influence McDonald’s Stock Values?

So-called “currency headwinds” are making trouble for McDonald’s–as they are for practically every corporation. Currency headwinds occur when the leading international economies are all trying to increase overall demand, both internal and external, by instituting loose credit policies and other similar strategies. The result: there is barely any change in the value of currencies in relation to one another, and prices are driven unproductively lower.

Is It Advisable to Buy McDonald’s Stocks This Quarter?

Given the “activist” attitude of McDonald’s CEO Steve Easterbrook, it seems like the answer is yes. More than simply increasing revenue and targeting the company’s tax burden, the company has managed to effectively bring down operating costs and expenses globally.

McDonald’s is bringing in new products, matching them to the different regions, such as the chicken a la carte in the Philippines and the customized burger in Australia. If the company can catch the momentum it has been given and move forward with it, it is likely that McDonald’s will continue its positive growth for years to come.