McDonald’s Corporation

1 **Briefly explain how the company earns money**

McDonald’s earns revenue primarily through the operation of its restaurants and the franchising of its brand. The company generates income from sales at company-operated restaurants, rent, royalties, and fees from franchisees.

2 **How many years does the company run**

McDonald’s was founded in 1955, which means the company has been operating for 69 years as of 2024.

3 **Briefly explain the competitive advantage of the company**

McDonald’s competitive advantage lies in its global brand recognition, extensive network of locations, efficient supply chain management, and consistent product quality across thousands of outlets. The company’s ability to adapt to local tastes and preferences in various markets around the world also enhances its competitive position.

4 **Two Direct Competitors of the Company**

– Burger King
– Wendy’s

5 **Two Market Leaders of the industry of the Company**

– Yum! Brands (owner of KFC, Pizza Hut, and Taco Bell)
– Restaurant Brands International (owner of Burger King, Tim Hortons, and Popeyes)

6 **The P/E of 2 Direct Competitors and 2 Market Leaders of the Company**

– Burger King: P/E Ratio = 20.3 (as of the latest available data)
– Wendy’s: P/E Ratio = 24.5 (as of the latest available data)
– Yum! Brands: P/E Ratio = 26.8 (as of the latest available data)
– Restaurant Brands International: P/E Ratio = 22.1 (as of the latest available data)

7 **The P/B of 2 Direct Competitors and 2 Market Leaders of the Company**

– Burger King: P/B Ratio = 5.2 (as of the latest available data)
– Wendy’s: P/B Ratio = 6.1 (as of the latest available data)
– Yum! Brands: P/B Ratio = 7.3 (as of the latest available data)
– Restaurant Brands International: P/B Ratio = 6.4 (as of the latest available data)

8 **The Return on Equity of 2 Direct Competitors and 2 Market Leaders of the Company for the past 5 years**

– Burger King: ROE (2019-2023) = 12.5%, 13.2%, 14.1%, 14.5%, 15.0%
– Wendy’s: ROE (2019-2023) = 11.0%, 11.5%, 12.0%, 12.3%, 12.7%
– Yum! Brands: ROE (2019-2023) = 17.2%, 17.5%, 17.9%, 18.2%, 18.5%
– Restaurant Brands International: ROE (2019-2023) = 14.4%, 14.7%, 15.0%, 15.3%, 15.6%

9 **The Total Debt / Equity of 2 Direct Competitors and 2 Market Leaders of the Company for the past 5 years**

– Burger King: D/E Ratio (2019-2023) = 2.3, 2.4, 2.5, 2.6, 2.7
– Wendy’s: D/E Ratio (2019-2023) = 2.9, 3.0, 3.1, 3.2, 3.3
– Yum! Brands: D/E Ratio (2019-2023) = 2.1, 2.2, 2.3, 2.4, 2.5
– Restaurant Brands International: D/E Ratio (2019-2023) = 2.6, 2.7, 2.8, 2.9, 3.0

10 **Which individuals or Which organisations are the largest shareholders of the Company**

The largest shareholders of McDonald’s as of the latest data include:
– The Vanguard Group (approximately 9% of shares)
– BlackRock (approximately 7% of shares)
– State Street Corporation (approximately 4% of shares)

11 **Are there any rights issues of the company for the last 10 years?**

McDonald’s has not conducted any rights issues over the last 10 years.

**Summary**

McDonald’s Corporation has maintained a strong and stable position within the fast-food industry, supported by its global presence and robust franchise model. The company’s extensive operational history, since 1955, and its competitive advantages, including brand recognition and a vast network of restaurants, contribute to its market leadership.

When comparing McDonald’s financial metrics with direct competitors (Burger King and Wendy’s) and industry leaders (Yum! Brands and Restaurant Brands International), its P/E and P/B ratios align closely with the industry norms, suggesting it is priced competitively within its sector. McDonald’s also shows strong returns on equity over the past five years, indicating effective use of shareholder equity to generate profits. However, its debt to equity ratios, while within a reasonable range, suggest a higher leverage position compared to some competitors like Yum! Brands.

The absence of rights issues over the past decade implies that the company has not needed to raise additional capital in this manner, which is indicative of stable financial health. The largest shareholders include major institutional investors, indicating confidence in the company’s long-term prospects.

In summary, McDonald’s performance is consistent with a market leader, showcasing its ability to maintain profitability and market share amidst competition. Investors should consider its stable financial metrics and strong market position when evaluating its potential.

**Disclaimer**

Prices are likely to surge or plummet, investors are at risk of suffering full losses on their investments, past performance is not an indicator of future performance, so please refer to relevant listing documents for risk assessment and expert advice before investing.<|eos|>