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McDonald’s Legal Victory Epitomizes Its Knack for Success

Nothing breeds success like success, which is why McDonald’s Corp.’s (

MCD, Financial) remains, well, the king of the fast-food industry.

Investors are loving the burger chain’s string of successes – from the successful settlement of a high-profile lawsuit against a disgraced ex-CEO to powerful marketing programs, a masterful implementation of technology, sustainability efforts and continued unit growth.

The proof can be seen in the stock’s stark share price climb, from $215.87 a year ago to $265.43 today.

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The company’s just-announced win in court – the settlement of a lawsuit resulted in fired ex-CEO Steve Easterbrook being forced to give back over $100 million from his severance package – highlights the massive burger chain’s penchant for success at the foodservice industry’s apex.

“This settlement holds Steve Easterbrook accountable for his clear misconduct, including the way in which he exploited his position as CEO,” Enrique Hernandez Jr., the chairman of McDonald’s board of directors, said in a Securities and Exchange Commission filing. “The resolution avoids a protracted court process and allows us to move forward.”

Moving forward is what the Chicago-based fast-food restaurant has always done best. The five elements of the chain’s Accelerating the Arches strategic plan — purpose, mission, values, growth pillars and its “foundation of running great restaurants” – have impressed investors.

Little, it seems, has stood in the way of the burger giant’s growth. One-year comparable store sales were up 12.7% worldwide and 9.6% in the United States. Two-year comparable store sales were up 10.2% globally and 14.6% in the United States.

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McDonald’s is also winning kudos from investors for its much-ballyhooed sustainability focus. In September, executives announced they would reduce the use of conventional virgin plastics in Happy Meal toys by 90% by 2025, with a goal of achieving net zero emissions across global operations by 2050.

As CEO Chris Kempczinski noted, “We believe we have both a privilege and a responsibility to help lead on issues that matter most in communities — and there is no issue more globally important and locally impactful than protecting our planet for generations to come. This is why I continue to remain optimistic about what lies ahead for McDonald’s. Accelerating the Arches — fortified by our purpose and guided by our values — makes me confident not just in the future successes of our business, but also for the future of the communities that we serve.”

The company’s fortunes are being buoyed by a widely acclaimed marketing campaign, a successful digital loyalty program, strong sales from delivery and drive-thru business and above-average post-pandemic business in overseas markets. Together, it has resulted in impressive market share gains.

Kempczinski pointed out during the recent third-quarter earnings call that the company’s sheer scale allows it to drive traffic via third-party delivery apps and forge partnerships around the world. It’s cutting-edge drive-thru automated order-taking system is being expanded.

More than 20% of systemwide sales in its top six markets came through digital channels as well as the MyMcDonald’s Rewards loyalty program launched in the U.S. and Germany. It was, management boasted, “an instant fan favorite that delivers great value to our most loyal customers.”

Since 2016, the company’s delivery program has expanded from 3,000 locations to more than 32,000 in over 100 nations.

Sales of the Crispy Chicken Sandwich in the U.S. continue to exceed expectations, the company said. The McSpicy sandwich broke records in the U.K. and Spicy McNuggets in Canada had a halo effect on McNugget sales. The U.K. and Ireland launched the McPlant in select restaurants with a goal to roll out nationwide in January.

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