McDonald’s shares were up more than 2.5% at $300 on Thursday after Goldman Sachs upgraded the stock, saying the fast food company is better positioned compared to its competitors.
Goldman Sachs has upgraded McDonald’s to a “Buy” rating from “Neutral,” citing the company’s relative strength in a challenging fast food environment.
Analyst Christine Cho, in a note to clients, emphasized that McDonald’s is better positioned than its peers to navigate current consumer pressures and win market share.
Despite sluggish performance in 2025, McDonald’s shares are up just 2% year-to-date and flat over the past month, Cho maintained a price target of $345 per share.
This represents an 18% upside from the stock’s closing price on Wednesday. For comparison, the broader S&P 500 index is up approximately 6.5% year-to-date.
The upgrade comes amid broader concerns for the fast food industry, which is seeing slowing sales growth as consumers tighten their spending.
However, Cho believes McDonald’s has the scale, marketing, and digital capabilities to outperform competitors in this environment.
Menu changes and marketing drive positive signals
A key element of Goldman’s bullish outlook is McDonald’s renewed focus on menu innovation and marketing.
The company has recently reintroduced several popular items, including the return of the chicken Snack Wrap, which hits US menus on Thursday.
It has also added the Daily Double burger to its McValue platform in the U.S.
“We believe MCD ultimately has the scale/marketing/digital advantage to successfully navigate through this environment,” Cho wrote. “Management has firmly committed to market share gains through product and marketing innovation.”
Cho noted that early data suggests McDonald’s is gaining share from other burger brands, with menu updates resonating positively with customers.
This could help reverse the trend of slowing same-store sales growth, which has been a concern across the industry.
Sales resilience supports bullish case
Goldman’s analysis points to McDonald’s relative sales resilience compared to its fast food rivals.
The firm noted that McDonald’s has maintained mid-single-digit year-over-year observed sales growth, while many of its peers have slipped into low single-digit or even negative growth territory.
This performance gap, combined with strategic marketing and an efficient cost structure, gives McDonald’s an edge as consumers continue to adjust their spending habits amid economic uncertainty.
Goldman expects these strengths to translate into stronger comparable sales and long-term shareholder returns.
While the fast food industry is facing broad challenges from inflation and consumer fatigue, McDonald’s appears to be weathering the storm more effectively than most.
With a solid brand, a global footprint, and the ability to quickly adapt its offerings, the company remains a standout in a tough sector.
Goldman’s upgrade and outlook suggest that McDonald’s could be poised for a turnaround in the second half of 2025, as it leverages innovation and scale to retain and grow its customer base.
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