Why McDonald's Stock Is Soaring Despite E. coli Wave and Low Sales?
Feb 11, 2025
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According to U.S. media such as the New York Post, McDonald's stock price on the New York Stock Exchange on the 10th (local time) was USD 308.42, up 4.80% from the previous day.
The gains are unusual given the fallout from the previously controversial E. coli incident and the worst loss of sales in the U.S. since the COVID-19 pandemic.
Earlier in October last year, McDonald's experienced a sharp drop in sales as E. coli 'O157:H7' was detected in quarter pound hamburgers, with 75 people showing symptoms of food poisoning in 13 states, and one of them died.
In addition, according to investment companies, McDonald's sales in the fourth quarter of last year reached $6.38 billion (about 9.28 trillion won). This is below the average analyst prediction of $6.44 billion compiled by LSEG. The quarter-on-quarter sales drop was 1.4%, the steepest decline in about five years when the pandemic limited restaurants to drive-thru and delivery.
Despite such deteriorating performance, analysts say the rise in stock prices is due to strong overseas markets. Global store sales rose 0.4%, beating Wall Street's expectations for a 1% decline.
The International Development Licensing Market segment, which includes the Middle East and Japan, saw a 4.1% jump in sales, while McDonald's International Operations Market segment, which includes the largest markets such as Canada, the United Kingdom, France and Germany, also saw a 0.1% jump in sales.
In addition, the fact that the earnings per share (EPS) of $2.83 was in line with expectations also contributed to the rise in the stock price.
This article was translated by Naver AI translator.
