This fast-food giant is set for growth

Article Excerpt

MCDONALD’S CORP. $180 (New York symbol MCD; Income-Growth Dividend Payer Portfolio, Consumer sector; Shares outstanding: 770.9 million; Market cap: $138.8 billion; Dividend yield: 2.6%; Dividend Sustainability Rating: Highest; www.mcdonalds.com) is the world’s largest operator of fast-food restaurants, with 37,557 outlets in 120 countries. It serves a wide variety of food, but is best known for its hamburgers and french fries. The company has raised its dividend each year since 1976. Starting with the December 2018 payment, McDonald’s increased its quarterly dividend by 14.9%, to $1.16 a share from $1.01. The new annual rate of $4.64 yields 2.6%. Sales fell 23.4%, from $27.4 billion in 2014 to $21.0 billion in 2018. That’s because McDonald’s continues to sell company-owned stores to franchisees; the goal is to have them operate 95% of its restaurants, up from today’s 93%. Overall earnings also declined 4.8%, from $4.8 billion in 2014 to $4.5 billion in 2015. McDonald’s is an active buyer of its own shares, so per-share earnings fell at a slower…