McDonald's Corporation (MCD) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-1.0%

$261.03

vs $263.70 price

Levered DCF

$196.02

After debt service

Piotroski score

8 / 9

Strong

Altman Z-score

4.65

Safe zone

Rating

C+

Overall 2 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	25.47×	25.32×	25.5×	31.41×	26.52×	33.79×	24.86×	23.33×
P/B	-121.74×	-54.84×	-45.85×	-32.33×	-43.48×	-20.42×	-18.25×	-22.08×
P/S	8.11×	8.03×	8.47×	8.37×	8.61×	8.32×	7.11×	6.57×
EV / EBITDA	18.54×	18.58×	19.07×	22.03×	20.09×	22.81×	18.26×	16.38×
Gross margin	57.4%	56.8%	57.1%	57.0%	54.2%	50.8%	52.7%	51.3%
Operating margin	46.1%	45.2%	45.7%	40.4%	44.6%	38.1%	43.0%	42.0%
Net margin	31.9%	31.7%	33.2%	26.6%	32.5%	24.6%	28.6%	28.2%
Current ratio	0.95×	1.19×	1.16×	1.43×	1.78×	1.01×	0.98×	1.36×
Debt / equity	-30.61×	-13.68×	-11.28×	-8.11×	-10.73×	-6.58×	-5.79×	-4.97×
Interest coverage	7.83×	7.78×	8.56×	7.76×	8.73×	6.01×	8.08×	8.99×
Dividend yield	2.3%	2.3%	2.1%	2.1%	2.0%	2.3%	2.4%	2.4%
Payout ratio	59.7%	59.2%	53.5%	67.5%	51.9%	79.3%	59.4%	55.0%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	-478.1%	-216.6%	-179.9%	-102.9%	-164.0%	-60.5%	-73.4%	-94.7%
Return on invested capital	17.4%	17.9%	18.0%	15.6%	16.9%	11.4%	15.3%	22.4%
Return on assets	14.4%	14.9%	15.1%	12.2%	14.0%	9.0%	12.7%	18.1%
Free cash flow yield	3.3%	3.2%	3.4%	2.8%	3.5%	2.9%	3.8%	3.1%
Earnings yield	3.9%	3.9%	3.9%	3.2%	3.8%	3.0%	4.0%	4.3%
Enterprise value	$272.1B	$259.1B	$264.3B	$240.2B	$244.7B	$207.8B	$196.5B	$168.4B
Net debt / EBITDA	3.68×	3.65×	3.5×	4.23×	3.66×	5.27×	4.34×	2.94×
Cash conversion cycle (days)	-1	2	1	-1	-3	13	4	1