McDonald's: 3 Key Takeaways for Long-Term Investors

Source Motley_fool

Key Points

  • McDonald's tested new everyday value bundles across 1,900 U.S. restaurants.

  • Specialty beverage orders increased average check sizes by about 50%.

  • The company aims to franchise 98% of global restaurants by 2028.

  • Motley Fool Issues Rare "Total Conviction" Buy Alert ›

On its third-quarter 2026 earnings call, held on Nov. 4, 2026, McDonald's (NYSE:MCD) announced global comparable sales growth of 1.5% for the quarter. For long-term investors, customer visit frequency and menu pricing power remain critical factors for sustainable profit growth. Three things management said on the call stand out.

1. Testing Entry-Level Value Menu Options to Boost U.S. Store Traffic

Management is testing new everyday affordable meal options across 40% of U.S. restaurants to address entry-level pricing. Fixing baseline guest traffic remains key for franchise profitability and store volume.

Just last week, we began an eight-week test of two new everyday affordable price menu constructs across all day parts in about 1,900 restaurants across a handful of regions.
-- Chris Kempczinski, Chairman and Chief Executive Officer

2. Expanding Specialty Beverages to Drive Higher Check Amounts and Market Share

Specialty beverages are expanding across global markets to capture non-peak customer traffic. Orders containing these beverages generate check totals that are larger than the full-day average check.

We continued to see checks that included a specialty beverage up about 50% compared to the full-day average check, with the majority of units sold after lunch. The addition of Red Bull Dragonberry Energizer in August delivered a boost to the platform, with minimal cannibalization of Refreshers and crafted sodas.
-- Ian Borden, Chief Financial Officer

3. Moving Toward a 98% Franchised Restaurant Model to Secure High Operating Margins

Refranchising efforts in international operated markets (IOM, company-operated international stores) continue as the business aims for a 98% franchised portfolio by 2028. This asset-light model protects operating margins and capital efficiency.

We are making steady progress toward our goal of having 98% of our global restaurant portfolio franchised by 2028, having refranchised about 175 restaurants across the U.S. and IOM so far this year.
-- Ian Borden, Chief Financial Officer

Looking Ahead

Baseline guest traffic is turning positive heading into the fourth quarter following targeted promotional interventions. Management is watching pricing discipline and store execution across international markets.

We're taking the right steps to improve our near-term performance in the U.S., and I'm encouraged by our baseline traffic trends in September and October.
-- Chris Kempczinski, Chairman and Chief Executive Officer

The company maintains a vast global store footprint, strong brand equity, and unmatched supply chain scale. Future value depends on executing its multi-year growth plan, McDonald's > NEXT, through digital engagement and modern store remodels.

We are encouraged by the improvement in U.S. baseline trends that we saw as the quarter progressed, and remain focused on the further work to do to position the business for stronger, more consistent performance in 2027. At the same time, we will continue investing behind McDonald's > NEXT at scale to drive sustainable long-term growth and productivity.
-- Ian Borden, Chief Financial Officer

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The Motley Fool recommends the following options: long January 2028 $320 calls on McDonald's and short January 2028 $340 calls on McDonald's. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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