McDonald's Stock Is Pacing For One of Its Worst Weeks In Years

MCD stock bulls may be caught off guard by its sudden weakness

Mar 2, 2018 at 10:43 AM
facebook twitter linkedin

Shares of McDonald's Corporation (NYSE:MCD) are down 4.1% this morning at $149.31, as they continue to pull back from their Jan. 29 record high of $178.70. Sparking today's sell-off is a price-target cut to $170 from $190 at RBC, which cited lackluster early sales data for the fast food company's new dollar menu. As such, MCD stock is pacing for its lowest weekly settlement since May, down 8.1% for the week -- which would actually mark its third worst weekly performance in the past decade.

mcd stock price

Short sellers have been moving in amid the stock's recent weakness. In the last two reporting periods alone, short interest jumped 15.3%. Despite this, less than 1% of the equity's float is controlled by short sellers, suggesting there's plenty of room on the bearish bandwagon.

Not only could rising short interest weigh on MCD shares, but an unwinding of optimism from other analysts and options traders could also be a factor. For example, 21 of 26 brokerage firms say the Dow component is a "buy" and the average 12-month price target stands all the way up at $188.44.

And at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the security has accumulated a 10-day call/put volume ratio of 1.31, which ranks in the 71st annual percentile. This confirms call buying has been unusually popular compared to put buying.

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners