MCD
McDonald's
Dividend / Cash flow
★ Quality 74/100Price today
$255.69
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What this business is made of
The business
McDonald's doesn't sell burgers: it's a landlord dressed up as a clown.
McDonald's operates 43,000 burger joints globally, but 95%+ are franchises. It collects royalties (~5% of sales) and real estate rent from its franchisees. The real business is being the biggest landlord in fast food.
Location density impossible to replicate and a franchise economy where McDonald's owns the land. The brand lets it charge above-market rents to operators who still make money. Not a monopoly, it's scale with a real estate toll.
Revenue history
From $23.2B to $26.9B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $26.9B · FY2025
Of every $100 in sales, $68 goes to costs and operations; $32 is left as net profit (32% margin).
Catalysts and risks
Plan to open 50,000 restaurants by 2027 (vs ~43,000 today).
Dividend growing 48 years straight, current payout ~$7.7B annually.
Traffic recovery in the U.S. after value menu launched in 2024.
GLP-1 (Ozempic) structurally reduces appetite in Western consumers.
Net debt of $39B with high rates squeezes future FCF.
Market pays 38x EV/FCF for a business growing 4% — fragile multiple.
Charlie's note
“A landlord dressed up as a burger joint. Excellent business, fantasy price: paying 38x to grow 4% is math for optimists.”
Analysis · May 2026
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