McDonald’s Corporation (MCD) faces largest Monthly Decline since 2003 whilst losing Young Customers To Other Restaurants Including Chipotle Mexican Grill, Inc. (CMG)

McDonald’s Corporation (NYSE:MCD) shares are down by 0.9% in the last 30-day period and closed at $94.45 on August 22, 2014. According to the company, this is the largest monthly decline in its same-stores sale worldwide since 2003. The company has lost 2% share value since the start of 2014. On the other hand, Chipotle Mexican Grill, Inc. (NYSE:CMG) achieved an increase of 17% in the same store sales.

McDonald’s Corporation (NYSE:MCD) has 40% of its stores operating in the U.S. working at loss or no growth for the past 13 months. The company has a global chain of 35,000 restaurants but it is losing its edge among the U.S. consumers. According to the data collected by Technomic Inc, restaurant consultancy, for WSJ, there is an age problem standing ahead of the company.

Mc Donalds (MCD)

The data indicated that the primary customer base of the company, customers in 20-30 years age group, is alienating towards better and healthier eating options. Increasing sales of fast-casual restaurants have hurt the sales of McDonald’s Corporation (NYSE:MCD) in the past one year with Chipotle Mexican Grill, Inc. (NYSE:CMG) and Five Guys Enterprises, LLC being its primary rivals.

Further, the company is planning to change the head of its U.S. operations and Mike Andres, former executive in the company, is expected the head the domestic operations. This is the second time that McDonald’s Corporation (NYSE:MCD) has changed the head of its U.S. division in the past two years.

Earlier, McDonald’s Corporation (NYSE:MCD) reported earnings per share of $1.40 with revenue of $7.2 billion. The company had consolidated revenue increase of 1% and the company distributed $1.6 billion to the shareholders through share repurchases and dividend distribution. The CEO of the company, Don Thompson, said,

“Overall, 2014 is a year of strengthening the foundational elements of our business that are critical to enabling and advancing our longer-term strategies.”

This article has been written by Prakash Pandey and edited by Serkan Unal.

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