UBS sees fresh sizzle in McDonald’s after pullback

After an 11% retracement since mid-May, McDonald’s (NYSE:MCD) shares are attractively priced as trends improve and as new products, value initiatives and marketing plans deliver same store sales growth, says UBS analyst Dennis Geiger in a note to clients.

McDonald’s (NYSE:MCD) shares have been on the defensive since May 20 as investors bailed out of the stock amid concerns about consumer spending habits, backlash on price hikes, and the proliferation of weight-loss medication that has undermined fast food chains and snacking categories.

But while Geiger recognizes quick service sales trends remain pressured, he anticipates share gains as U.S. and international trends improve, particularly if the risk-on trade cools.

“McDonald’s appears well positioned to deliver solid [same store sales] in H2 2025 driven by new products, value initiatives, and marketing plans that should resonate, even as lower and middle income spending pressures could linger,” Geiger says.

The company has also enacted key initiatives that will support share gains and stronger same store sales in the second half of this year, including menu innovations, value meal deals, marketing promotions, expanded summer hours, and, the introduction of CosMc’s beverages into McDonald’s locations.

UBS is bullish on McDonald’s with a Buy rating and $350 price target that assumes a 22% upside to Thursday’s closing price. Geiger’s Buy rating is consistent with the average rating among Wall Street analysts, while Seeking Alpha analysts and Quant rating have maintained a Hold rating on McDonald’s (NYSE:MCD) since at least October 2024.