MCD is in big trouble. May not exist in 5 years

Discussion in 'Stocks' started by hajimow, Apr 15, 2015.

  1. hajimow


    True they have free refill and that is a good strategy but quality is terrible. Panera has offered one month free coffee for those who have Panera card and although it was free, I could not stand the bad and watery taste. As they say, tastes are different. Aside from coffee, the valuation is high. Just put a 17 for P/E instead of 27 and calculate the price. Remember I said 17 and not 10.
    #51     Apr 29, 2015
  2. hedron


    Maybe in 50 years. Not in 5.
    #52     Apr 29, 2015
  3. hajimow


    Market is expecting the possibility of big drop for MCD stock after it announces its restructuring plan on May 4th. May 8th PUTs are very expensive. Even 89.5 strike price ($7 drop) is 0.18 to 0.28. Based on my experience very expensive. Calls are not that expensive.
    #53     Apr 30, 2015
    xandman likes this.
  4. xandman


    A lot of calls being sold on the bid.
    #54     Apr 30, 2015
  5. hajimow


    Turnaround plan was announced today. Basically it shows that there is no solution or plan to change the menu or anything that is food related. The only plan is buyback. The sluggish sales and down trend in sales will continue.
    #55     May 4, 2015
  6. hajimow


    My question is that whether that "big exciting complicated turnaround plan" which was just buyback was worth 2 weeks to wait? Couldn't they announce it sooner? Is MCD management trying to buy time? Create excitement and hope among shareholders that maybe stock will rally just based on hope and rumors?
    #56     May 4, 2015
  7. hajimow


    S&P also downgrades MCD from A to A- after restructuring plan. outlook stable.
    #57     May 4, 2015
  8. hajimow


    If you are short MCD, you can sell covered PUT for the strike price of 94, and 94.5 expiring this Friday. Bid/ask for 94 is 0.09/0.14 and for 94.5 is 0.15/0.21
    If you are long or believe MCD will not drop to below 94.5 by this Friday, you can still sell the options and get a good premium.

    MCD is trading at 96.15 now.
    #58     May 6, 2015
  9. samuel11


    I am having the new sirloin burger for the 1st time right now, and it’s delicious!
    #59     May 7, 2015
  10. luisHK


    Anyone knows what set MCD on fire today ?
    I was watching Timbuktu but the action on MCD disrupted the show - as well as the daily pnl (mtm at least)
    #60     May 19, 2015