McDonald’s (MCD) – Get Free Report shares moved higher in pre-market trading ahead of the world’s biggest restaurant chain’s third quarter earnings prior to the opening bell.
Analysts expect McDonald’s to post a 12% rise in diluted earnings for the three months ending in September, with a bottom line of $3.00 per share, as revenues jump 12.1% to $6.58 billion, helped in part by targeted ad campaigns and value-conscious diners still pinched by elevated levels of inflation in the world’s biggest economy.
That dynamic could be changing course of the final months of the year and beyond, however, with easing inflation and a resilient economy providing wider choices for restaurant-goers beyond its 13,400 U.S. locations.
That may have influenced the group to boost its annual fees for new franchisees, which Reuters reported would rise to 5% from 4% as part of its first increase in three decades.
Chief Financial Officer Ian Borden also told investors in July that menu prices would likely fall over the back half of the year, in-line with softer inflation prospects.
Investors may also look for commentary on a lawsuit filed against the group over the depictions of its burgers, which the plaintiff alleged were misleading.
U.S. District Judge Hector Gonzalez dismissed the suit earlier this month, but a similar complaint against Restaurant Brands QSR-owned Burger King was given the right to go ahead a federal judge in Miami in late August.
McDonald’s shares were marked 1% higher in pre-market trading to indicate an opening bell price of $258.34 each a move that would trim the stock’s six-month decline to around 13%.
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