McDonald's Q3 Earnings Preview: Trump Visit, E. Coli Outbreak In Focus, Analysts Highlight Global Scale, Franchise Strength
Restaurant company McDonald’s Corp MCD has made plenty of headlines over the last two weeks with an appearance by Donald Trump at a restaurant and an E. coli outbreak at restaurants in the Western portion of the United States.
Analysts and investors are bracing for the impact of these items and more when the company reports third-quarter financial results before the market open Tuesday.
McDonald’s Earnings Estimates: Analysts expect McDonald’s to report third-quarter revenue of $6.82 billion, up from $6.69 billion in last year’s third quarter, according to data from Benzinga Pro.
The company missed revenue estimates from analysts in two of the last three quarters, but has beaten estimates in seven of the last 10 quarters overall.
Analysts expect the company to report earnings per share of $3.20 compared to earnings per share of $3.19 in last year’s third quarter. The company missed analyst estimates in the second quarter, but previously beat estimates in nine straight quarters before that.
What McDonald’s Analysts Are Saying: Analysts are still weighing the impact of an E. coli outbreak with 75 reported cases and one fatality in 13 states. The company took the quarter pounder off the menu, but will soon be bringing it back without raw onions in the impacted states.
While the financial impact could take some time to be evaluated, analysts recently stressed that a huge selloff in McDonald’s stock might be overdone.
“We will monitor the situation as it’s only natural to expect a short-term impact to sales,” TD Cowen analyst Andrew Charles said.
The analyst, who has a Hold rating and $300 price target on McDonald’s compared the E. coli outbreak to past cases at other restaurant chains.
Every 1% change in U.S. same-store sales could amount to around a 9-cents-per-share earnings impact in future quarters, Charles estimates, listing a “worst-case sales impact” of 37 cents to fourth-quarter earnings per share.
Wedbush analyst Nick Setyan maintained an Outperform rating with a $295 price target on McDonald’s shares.
“MCD well positioned to contain quickly, and any impact likely much more limited than CMG,” Setyan said, comparing the E. coli outbreak to a past Chipotle outbreak.
McDonald’s franchised, global base has a limited impact on its overall financials, the analyst said.
“MCD has the scale and expertise to respond and contain far more quickly than CMG at the time.”
Stifel analyst Chris O’Cull maintained a Hold rating with a $257 price target on the stock. The analyst said it’s hard to estimate the financial impact with more cases likely to be reported.
“Fortunately, McDonald’s has regional suppliers, so it quickly pulled certain items at risk, likely limiting the impact,” O’Cull said.
The analyst used an example of a past outbreak of E. coli at Chipotle locations, which led to five quarters of negative same store sales growth. O’Cull said Wendy’s managed an E. coli outbreak in 2022 “much better” and most investors don’t remember the outbreak.
Wendy’s saw a minimal impact on traffic. Like McDonald’s, it removed the sources and the menu items in stores, O’Cull added.
KeyBanc analyst Eric Gonzalez said the E. coli outbreak could “derail” momentum for McDonald’s.
The analyst maintained an Overweight rating with a $330 price target on the stock.
The analyst said it’s easy to compare the McDonald’s outbreak to Chipotle and other past restaurant outbreaks. But, to assume that it will face a similar outcome “might be too extreme of a bear case,” he said.
About 30% of McDonald’s stores are located in the U.S. That, along with its 95% franchise model, could insulate the company from a severe financial impact, Gonzalez adds.
Key Items To Watch: The E. coli outbreak containment and financial impact will be the top item on the mind of analysts and investors when McDonald’s reports earnings Tuesday. With the outbreak still relatively new, the company may not be able to provide a best-case and/or worst-case financial impact at this time.
The company announcing that all cases have been reported or the return of the quarter pounder being back on the menus nationwide could be items to watch for that could spark optimism among investors.
An appearance by Trump at a franchised Pennsylvania location drew national attention and prompted McDonald’s to issue a statement that it does not endorse candidates. The company could be asked further about the appearance, any impact from the viral event and more during the question-and-answer segment for analysts on the earnings call.
With a foodborne illness outbreak underway, McDonald’s may struggle to give too much forward guidance, which could make the stock increasingly volatile on Tuesday and for the rest of the week.
MCD Price Action: McDonald’s stock was trading 1.65% ahead of the close to $297.44 ahead of the close Monday versus a 52-week trading range of $243.53 to $317.90. McDonald’s stock is up 0.2% year-to-date in 2024, after falling over 5% in the last five trading days.
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Pfizer, Alphabet And 3 Stocks To Watch Heading Into Tuesday
With U.S. stock futures trading mixed this morning on Tuesday, some of the stocks that may grab investor focus today are as follows:
- Wall Street expects Pfizer Inc. PFE to report quarterly earnings at 62 cents per share on revenue of $14.95 billion before the opening bell, according to data from Benzinga Pro. Pfizer shares gained 0.3% to $28.95 in after-hours trading.
- Analysts are expecting Phillips 66 PSX to post quarterly earnings at $1.66 per share on revenue of $34.46 billion. The company will release earnings before the markets open. Phillips 66 shares rose 0.3% to $129.32 in after-hours trading.
- Ford Motor Company F posted better-than-expected earnings and sales results for the third quarter. However, the company said it sees full-year adjusted EBITDA of about $10 billion. Ford shares declined 6% to $10.69 in the after-hours trading session.
Check out our premarket coverage here
- Before the markets open, McDonald’s Corporation MCD is projected to report quarterly earnings at $3.2 per share on revenue of $6.82 billion. McDonald’s shares gained 0.1% to $297.20 in after-hours trading.
- Analysts expect Alphabet Inc. GOOGL GOOG to report quarterly earnings at $1.84 per share on revenue of $86.31 billion after the closing bell. Alphabet shares gained 0.5% to $167.50 in after-hours trading.
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Elon Musk Says Neuralink Brain Implants Could Cost As Little As An Apple Watch: 'We Do Have A Game Plan'
Telsa and SpaceX CEO Elon Musk, who is also the founder of the brain implant company Neuralink, has suggested that the company’s innovations could be as affordable as an Apple Watch.
What Happened: Speaking at the 2024 Congress of Neurological Surgeons last month, Musk shared his vision for Neuralink’s brain implants, saying that these devices should not be prohibitively expensive.
He proposed that in high volumes, the cost of these implants could start at around the same price as an Apple Watch or a smartphone, potentially between $1,000 and $2,000.
“If it’s implanted with a robot, then that surgical procedure should be fast,” he stated, adding, “We do have a game plan.”
The Tesla CEO also detailed a plan for what he termed the “600-second surgery.” This procedure, according to Musk’s vision, would involve a patient sitting in a chair and receiving an implant within just 10 minutes.
“We’re not violating physics,” the tech billionaire assured during his talk.
Why It Matters: In July 2024, Musk outlined Neuralink’s target to implant 1,000 brain chips by 2026.
If Musk’s vision of affordable brain implants becomes a reality, it could potentially revolutionize the BCI market and make this technology accessible to a larger population.
Previously, it was reported that Neuralink-rival Paradromics was also preparing for human trials of its brain implant, which was expected to be priced at around $100,000 each.
Another Neuralink rival, Synchron Inc., backed by Jeff Bezos and Bill Gates, also announced plans to extend its brain-device technology to treat conditions such as epilepsy and Parkinson’s disease in May.
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Aimco Announces Third Quarter 2024 Earnings Date
DENVER, Oct. 28, 2024 /PRNewswire/ — Apartment Investment and Management Company (“Aimco”) AIV announced today that it plans to report 2024 third quarter results on Thursday, November 7, 2024, after the market closes. Aimco’s earnings release will be available in the Investor Relations section of its website at investors.aimco.com.
About Aimco
Aimco is a diversified real estate company primarily focused on value add and opportunistic investments, targeting the U.S. multifamily sector. Aimco’s mission is to make real estate investments where outcomes are enhanced through its human capital so that substantial value is created for investors, teammates, and the communities in which we operate. Aimco is traded on the New York Stock Exchange as AIV. For more information about Aimco, please visit its website www.aimco.com.
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SOURCE Apartment Investment and Management Company (Aimco)
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Apple 'Will Be The First To Hit' $4 Trillion Market Cap Milestone, Says Dan Ives As Hundreds Of Apps Will Be Built On AI Feature
Apple Inc AAPL is positioning itself for a significant market cap milestone as it plans to integrate new AI features and capitalize on a potential iPhone “supercycle,” according to Wedbush Securities analyst Dan Ives.
What Happened: In an interview with CNBC’s “Squawk on the Street,” Ives predicted that Apple will be the first company to reach a $4 trillion market capitalization, potentially as early as next year. He cited the company’s strong iPhone sales forecast and the anticipated impact of AI integration across its software ecosystem as key drivers.
“I see this as the beginning of a super cycle, which I believe is going to take Apple to the $4 trillion market cap early next year,” Ives said. “They will be the first to hit it.”
Ives noted that Apple’s large existing iPhone installed base of over 300 million devices provides a significant upgrade opportunity, with the potential for 50% or more of those users to purchase new iPhones in the coming product cycle.
Furthermore, the analyst highlighted the importance of Apple’s Services business, which he expects will be bolstered by the integration of AI across numerous apps and features. Ives anticipates this could generate an additional $10 billion to $20 billion in Services revenue for the company.
“This is now going to be the hundreds of apps built on Apple Intelligence, which is going to give an incremental 10, 15, 20 billion of services revenue that is the key to this renaissance to growth from Cupertino,” Ives explained.
The analyst’s bullish outlook on Apple’s future performance is contingent on the successful integration of AI capabilities and the continued strong demand for iPhones, which he believes will reach a record 240 million units sold in the current fiscal year.
See Also: Alphabet Bulls Charge Ahead Of Q3: Will Meta’s AI Search, DOJ Roadblocks Change The Game?
Why It Matters: Ives’ prediction comes on the heels of Apple’s recent advancements in AI technology. The company introduced its latest iMac, featuring the M4 chip and integrated Apple Intelligence, on Monday. This development is expected to significantly enhance user productivity while prioritizing data privacy.
Analysts have also expressed optimism about Apple’s future earnings, with JP Morgan‘s Samik Chatterjee maintaining an Overweight rating on the company, citing AI upsides and resilience in Services revenues.
Ives previously said that skeptics of Apple who have overlooked the company’s substantial rise—over $1 trillion in market capitalization—have misjudged three critical elements of Apple’s trajectory: the installed base and pent-up iPhone upgrade demand, the growth of services and their valuation, and the emerging role of AI in consumer technology.
Price Action: Apple Inc. closed at $233.40 on Monday, reflecting a gain of 0.86%, for the day. In after-hours trading, the stock dipped 0.39%. Year to date, Apple’s stock has seen significant growth, rising by 25.73%, according to data from Benzinga Pro.
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Invesco Mortgage Capital Inc. To Announce Third Quarter 2024 Results
ATLANTA, Oct. 28, 2024 /PRNewswire/ — Invesco Mortgage Capital Inc. IVR will announce its third quarter 2024 results Tuesday, November 5, 2024, after market close. A conference call and audio webcast to review third quarter 2024 results will be held on Wednesday, November 6, 2024, at 9:00 a.m. ET. Scheduled to speak are John Anzalone, Chief Executive Officer; Mark Gregson, Interim Chief Financial Officer; Brian Norris, Chief Investment Officer; Kevin Collins, President; and David Lyle, Chief Operating Officer.
A presentation will be available on the Company’s Web site at www.invescomortgagecapital.com prior to the call.
Those wishing to participate should call:
North America Toll Free: 888-982-7409
International Toll: 1-212-287-1625
Passcode: Invesco
Webcast link: https://events.q4inc.com/attendee/692061579
An audio replay will be available until November 20, 2024, by calling:
866-363-4045 (North America) or 1-203-369-0206 (International).
About Invesco Mortgage Capital Inc.
Invesco Mortgage Capital Inc. is a real estate investment trust that primarily focuses on investing in, financing and managing mortgage-backed securities and other mortgage-related assets. Invesco Mortgage Capital Inc. is externally managed and advised by Invesco Advisers, Inc., a registered investment adviser and an indirect, wholly-owned subsidiary of Invesco Ltd., a leading independent global investment management firm. Additional information is available at www.invescomortgagecapital.com.
Investor Relations Contact: Greg Seals, 404-439-3323
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Wall Street Gains As Crude Tumbles, Small Caps Soar, Bitcoin Tops $68,000: What's Driving Markets Monday?
Investor sentiment turned optimistic towards risk assets early this week as plummeting oil prices, driven by Israel’s decision not to target Iran’s crude facilities during weekend attacks, eased concerns over an escalated Middle Eastern conflict and potential global economic disruptions.
The S&P 500 gained 0.3%, the tech-heavy Nasdaq 100 mirrored this performance and the Dow added 0.6%.
Economically sensitive small-cap stocks saw stronger gains, with the Russell 2000 soaring 1.5% after a stretch of losses in six of the last seven sessions.
West Texas Intermediate (WTI) crude – tracked by the United States Oil Fund USO – dropped over 5% in midday New York trading, heading for its sharpest one-day decline since July 2022. Natural gas prices also plunged, with Henry Hub prices falling more than 9%, poised for their steepest single-session loss since mid-January.
U.S. energy stocks weakened, with the Energy Select Sector SPDR Fund XLE standing as the sole sector in the red on Monday.
Despite the significant drop in energy prices, Treasury yields continued to rise, potentially tempering the stock market’s bullish momentum. Investors remain cautious about further U.S. fiscal policy deterioration as election season approaches.
Yields on 10-year Treasury bonds rose by 5 basis points to 4.29%, aiming for their highest close since July 11.
Gold prices held steady around $2,745 per ounce, marking no gains since last Tuesday’s close.
Sentiment in cryptocurrency markets remained bullish, with Bitcoin BTC/USD up 1.4% to over $68,000, reaching a one-week high, while Dogecoin DOGE/USD jumped 4.5% in its third consecutive session of gains, eyeing the highest levels since June.
Monday’s Performance In Major US Indices, ETFs
| Major Indices | Price | 1-day % change |
| Russell 2000 | 2,242.10 | 1.5% |
| Dow Jones | 42,381.18 | 0.6% |
| S&P 500 | 5,828.13 | 0.3% |
| Nasdaq 100 | 20,409.47 | 0.3% |
According to Benzinga Pro data:
- The SPDR S&P 500 ETF Trust SPY rose 0.54% to $581.22.
- The SPDR Dow Jones Industrial Average DIA rose 0.7% to $424.02.
- The tech-heavy Invesco QQQ Trust Series QQQ edged 0.2% higher to $496.42.
- The iShares Russell 2000 ETF IWM rose 1.7% to $222.55.
- The Financial Select Sector SPDR Fund XLF outperformed, up by 1.1%. The Energy Select Sector SPDR Fund lagged, down 0.8%.
Monday’s Stock Movers
- Airlines and cruise line stocks rallied as oil prices declined. American Airlines Group Inc. AAL was up by 4.5%, Delta Air Lines Inc. AAL, up by 4%, United Airlines Holdings Inc. UAL, up 3.5%, Carnival Corp. CCL, up 4.5%, Norwegian Cruise Line Holdings Ltd. NCLH, up 2.8%, and Royal Caribbean Cruises Ltd. RCL, up 0.9%.
Stocks reacting on earnings reports included ON Semiconductor Corp. ON, up 4.4% and CenterPoint Energy Inc. CNP, up 1%.
Large-cap companies slated to report their earnings after the close are Waste Management Inc. WM, Cadence Design Systems Inc. CDNS, Brown & Brown Inc. BRO and F5 Inc. FFIV.
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Extraordinary Experiences Cultivate Loyal Brand Advocates
Solidifi releases results from its Annual 2024 Consumer Mortgage Experience Survey(1) and the Solidifi 2024 Future Plans of Homeowners Survey(2)
BUFFALO, N.Y. and DENVER, Oct. 28, 2024 (GLOBE NEWSWIRE) — The sixth annual national survey(1) commissioned by Solidifi U.S. Inc. (“Solidifi”) revealed pent-up demand for home purchases remains strong even amid uncertain market conditions. The 2024 results offer valuable insights on how to make homeownership more accessible for borrowers as the market shifts and how to create extraordinary experiences and cultivate loyal brand advocates to drive future business.
“The findings show that during times of uncertainty, brand loyalty strengthens as consumers seek stability in their financial decisions,” said Solidifi President Loren Cooke. “The leading factor in lender choice continues to be a strong lending relationship. As a majority of consumers face increasing affordability issues, their propensity to bundle services with lenders also increases. And, this year more than ever, consumers are acting on their positive experiences – driving repeat and referral business.”
This year, the survey also introduced the mortgage industry’s Net Promoter Score (NPS), which received a solid 53 – well above the 30+ NPS benchmark for the financial services sector. “Interestingly, Gen Z consumers rated the industry lower, with a 34 NPS compared to all other demographics whose scores were in the 50’s. This suggests an opportunity to engage younger generations by focusing on transparency and building meaningful connections,” added Cooke. “Across generations, providing extraordinary experiences instills trust within the lender’s customer base and consumers become more likely to continue to expand existing relationships,” Cooke concluded.
In addition to the Annual 2024 Consumer Mortgage Experience Survey(1), Solidifi also conducted the 2024 Future Plans of Homeowners Survey(2) to explore how market conditions influence borrowers’ future real estate plans. The Solidifi 2024 Future Plans Survey revealed that while affordability issues remain prevalent, borrowers are increasingly researching options and adjusting expectations. Despite rising costs, homeownership continues to be seen as a pathway to generational wealth, with 60% of respondents planning to purchase a home within the next three to five years.
“Though higher interest rates have left many borrowers hesitant, the intent to buy remains strong. The median timeframe for future purchases is now around 2.25 years,” noted Cooke. “Exurb migration is outpacing urban growth as consumers seek more space, affordability, and better quality of life – trends particularly notable in underserved markets.”
For future borrowers, the rising cost of homeownership and a feeling of not being prepared are the largest barriers to entry. This year, borrowers faced greater difficulty with down payments; credit score challenges were on the rise, and many were increasingly motivated by the need to access cash for life events. Lenders are addressing this by offering special programs to overcome barriers to homeownership and rising housing costs. In 2024, borrowers were more informed about the special programs available to help reduce their costs in anticipation of their next move.
“Consistent with results from the past five years, borrowers continue to prioritize in-person interactions for both appraisals and closings,” said Cooke. “Across all generations, face-to-face engagement continues to be preferred due to the trust and care it fosters during what is the most significant financial transaction in a person’s life. However, there are opportunities to raise awareness, encourage adoption, and increase acceptance of digital tools throughout the process to provide the efficient, transparent and personalized experience consumers want.”
Results indicated that 82% of respondents prefer an in-person closing though Gen Z is most open to hybrid closing processes at 39%. Of the 82% who prefer face-to-face interactions: 56% prefer a paper process, 19% prefer in-person with fully electronic documents, and 25% prefer an in-person hybrid process. The top reasons for preferring face-to-face interactions are trust and the ability to get immediate answers during such a significant transaction.
“Results point to a direct relationship between offering convenience, transparency and flexibility, and a higher customer satisfaction,” said Cooke. “Providing an extraordinary experience including proactive communication throughout the transaction, convenient scheduling options, offering closing options and meeting expectations will result in happy customers, every time.”
To download the full survey results, visit: go.solidifi.com/2024mortgageexperiencesurvey.
[1]
In the Solidifi 2024 Consumer Mortgage Experience Survey, Market Street Research surveyed 1,000+ residential borrowers 18 years of age or older in the United States who purchased, refinanced or closed on a home equity loan or line of credit within the last two years. Panelists included a mix of those who purchased a home, refinanced or obtained a home equity loan or line of credit with approximately 49% closing within the past year, and 51% closing one to two years ago.
[2]
In the Solidifi 2024 Future Plans of Homeowners Survey, Market Street Research, surveyed 1,100+ residential borrowers 18 years of age or older in the United States who are a current homeowner or intend on owning a home at some point in the future. 56% of respondents currently own a home, 10% previously owned a home and 34% have never owned a home. Panelists included a mix of future buyers across the U.S. and those in underserved markets.
Both surveys were fielded by Snap Surveys, and the panels were sourced by Dynata. Fielding was executed July 2024.
About Solidifi
Solidifi is a leading network management services provider for the residential lending industry. Our platform combines proprietary technology and network management capabilities with tens of thousands of independent qualified field professionals to create an efficient marketplace for the provision of mortgage lending services. We are a leading independent provider of residential real estate appraisals and title, and settlement services. Our clients include top 100 mortgage lenders in the U.S. Solidifi is a wholly-owned subsidiary of Real Matters REAL. Visit www.solidifi.com for more information and stay connected with our latest news on LinkedIn.
For more information:
Jennie Craig
Vice President, Marketing
jlcraig@solidifi.com
832.236.3392
Solidifi and the Solidifi logo are trademarks of Real Matters and/or its subsidiaries. All other trademarks are the property of their respective owners.
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.