McDonald's rises 6.5% after quarterly earnings beat, revenue misses

What happened

McDonald's (MCD) rose 6.5% on November 4, 2026, because its third-quarter report showed adjusted EPS of $3.57 against $3.38 expected. The company reported revenue of $7.16 billion that missed forecasts, and U.S. comparable sales slipped 0.2% while international markets led growth and franchised margins improved, according to Reuters and Barrons. Trading on the stock was active, with volume 2.1 times its 20-day average, and the move outpaced the Consumer Cyclical sector median by 1.6 percentage points.

How big was the move

The stock rose 6.5% on the session and rose 11.9% over the last five sessions, a swing that equaled 4.1 times a typical daily move for this stock. The S&P 500 rose 1.6% on the day while the S&P 500 over five sessions fell 0.7%, showing McDonald's gains were far stronger than the broader market. The Consumer Cyclical sector median rose 4.9% on the day; the stock's performance was 1.6 percentage points better than that median. Market sensitivity for the name remains low, with a beta of 0.28, meaning the stock tends to move less than the market.

The technical picture

The stock opened 2.2% above the previous close and finished the session 12.6% above its 20-day moving average and 12.9% above its 50-day moving average. Its Relative Strength Index (14 days) stood at 79, above 70, a level often called overbought. The 50-day average is below the 200-day average, a sign of a weak longer-term trend, and the stock sits 0.9% below its 200-day moving average. McDonald's is 18.0% below the 52-week high and showed 25% annualized volatility over 60 days, a reading higher than 99% of its own readings over five years.

Those technical details help explain the scale of the move. The stock's lift pushed it farther above short-term averages, reinforcing short-term bullishness implied by recent momentum. At the same time, the longer-term pattern — the 50-day average remaining below the 200-day average — underscores a still-cautious view of the trend from a multi-month perspective.

Fundamentals and valuation

Over the four quarters through June 30, 2026, McDonald's reported revenue of $27.70 billion, which grew 6.3% from a year earlier, and diluted earnings per share of $12.31, which rose 5.5%. Gross margin was 57.4% (a year earlier: 57.0%) and operating margin was 46.2% (a year earlier: 45.8%). Free-cash-flow margin stood at 28.0% and return on invested capital was 17.8%.

The balance sheet showed net debt of 3.6 times EBITDA and share count over one year decreased by 0.9%. The stock traded at 22.8 times trailing earnings and 21.8 times expected earnings, with a free-cash-flow yield of 4.2%. The price to trailing earnings figure is lower than 95% of its own readings over the past five years. The five-year median was 26.0 times earnings, which highlights how current trailing valuation compares with most readings in that span.

Those fundamentals paint a mixed picture. Profitability measures and cash-generation metrics remain strong, with high margins and a sizable free-cash-flow margin. Yet the company carries leverage equivalent to 3.6 times EBITDA, a factor investors will watch alongside cash generation and capital returns.

Earnings and analyst expectations

McDonald's reported on November 4, 2026, with adjusted EPS of $3.57, 5.6% above estimates of $3.38, marking four consecutive quarters beating estimates and an average surprise over the last four reports of 3.3% above estimates. Revenue missed at $7.16 billion and U.S. comparable sales slipped 0.2%, underscoring that upside in per-share results has not been matched uniformly by top-line strength in the U.S.

Typical two-day reaction after recent reports was that the stock rose 1.8%, making the current session's 6.5% rise unusually large by that historical standard. Analysts tracked by consensus put the price target at $283.58, 1.2% above the closing price, based on ratings from 63 analysts; 59% of those ratings are Buy or Strong Buy and the consensus rating is Buy. The next report is scheduled for February 10, 2027.

What to watch

• February 10, 2027: next quarterly report date.
• Tests of everyday value bundles at 1,900 U.S. restaurants as the company seeks to sharpen its value proposition, reported by Market Watch and The Motley Fool.
• The company increased its dividend, marking the 50th consecutive year of dividend growth, reported by The Motley Fool.
• Net debt of 3.6 times EBITDA and free-cash-flow margin of 28.0% as indicators of balance-sheet and cash-generation strength.