Fast Food Giant Bites Off Record Before Earnings

The security has a dismal post-earnings past

Digital Content Manager
Apr 27, 2021 at 3:22 PM
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The shares of fast food giant McDonald's Corp (NYSE:MCD) are up 1.2% at $235.10 at last check, after hitting an all-time high of $235.38 earlier today. The positive price action comes just a few days prior to the equity's first-quarter earnings report, which is due out before the open on Thursday, April 29. Below, we will dive into how the stock has been performing on the charts, and explore some of its previous post-earnings activity.  

McDonald's stock bounced off the $202 level in March to eventually regain support at the 20-day moving average, which had been inconsistent since the equity's last peak in September. The security started carving a channel of higher highs earlier this month, and is now up 26.4% year-over-year.

MCD 20 Day

Over the last two years, the equity has had an overall dismal history of post-earnings reactions. Specifically, five of these next-day sessions were lower during its past eight reports, including a 5% drop in October 2019. The security has averaged a post-earnings swing of 1.5% in the last eight quarters, regardless of direction. This time, the options market is pricing in a bigger move of 3.7%.

The brokerage bunch is overwhelmingly optimistic towards the security, with 15 of the 21 analysts in coverage sporting a "buy" or better rating, while six call it a "hold." Plus, the 12-month consensus price target of $247.76 is a 5.4% premium to the stock's current perch. 

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