McDonald’s Corp. share price down, posts declining U.S. sales for four straight months

McDonalds Corp., which is currently considered as the largest restaurant chain worldwide, announced a same-store sales drop for February 2014, which is its fourth consecutive month of declines. The sales were said to have decreased by 0.3% due to the recent pressure on the fast-food industry and in spite of the vigorous TV promotions released during the Winter Olympics.

McDonalds Corp. made an official statement, posting a 1.4% decline of the domestic same-store sales in comparison to analysts expectations for a 0.6% decline in the U.S. The company also pointed out the harsh weather conditions as a negative factor that influenced its sales results.

One of the analysts working for Telsey Advisory Group – Mr. Peter Saleh – said in an interview, which was cited by Bloomberg: “Weather was definitely an impact in the month of February – that’s going to be a drag on everybody.” He also added: “The other players from Wendy’s to Jack in the Box to Sonic to Burger King have just improved their game a little bit and they’re taking back some share.”

In the companys statement Mr. Peter Bensen, who is the current Chief Executive Officer of McDonalds, explained that the global comparable-store sales, which have little changed in 2014 will pressure margins during the first quarter.

According to analysts, the fact that McDonalds has been forced to deal with the greater rivalry of fast-casual chains such as Panera Bread Co. and Chipotle Mexican Grill Inc. is also one of the reasons for the disappointing performance of the company in the U.S. Analysts also shared their belief that McDonalds is having some difficulties in meeting the expectations of customers, who are trying to eat healthy foods.

McDonalds Corp. fell by 0.31% in New York on Monday to close the session at $95.20 per share, marking a one-year change of -3.56% and a market value of $94.24 billion. According to CNN Money, the 24 analysts offering 12-month price forecasts for McDonalds Corp. have a median target of $103.00, with a high estimate of $115.00 and a low estimate of $91.00. The median estimate represents a +8.19% increase from the last close.