MCD
McDonald's Corporation
$282.27
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Mild
·
Conviction
Fair Value
Trading 13.3% below fair value
You pay
$282.27
Bear
$275.42
Fair
$325.50
Bull
$375.58
Bear
$275.42
-2.4%
$12.07 × 22x P/E
Fair
$325.50
+15.3%
$12.07 × 26x P/E
Bull
$375.58
+33.1%
$12.07 × 30x P/E
Key Value Driver
Normalized P/E multiple (26x base case)
Implied Market Multiple
23.4x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $347.33 from 62 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $325.50 per share.
Warnings
Dividend-based valuation: $444.27 (above our primary estimate by 42%). Large gaps may signal the dividend doesn't reflect full earning power.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples