McDollars & Cents

MCDONALDS: Earnings Are In

McDonald’s reported mixed results for its latest quarter, leading to a slight dip in shares by less than 1%. The company saw an increase in fourth-quarter net income to $2.04 billion, or $2.80 per share, with net sales up 8% to $6.41 billion. However, global comparable sales only grew by 3.4%, missing expectations due to the impact of the Israel-Hamas conflict on its Middle Eastern markets. In contrast, U.S. same-store sales rose by 4.3%, supported by price increases and digital sales growth.

Despite a slowdown in U.S. customer traffic previously attributed to higher prices, McDonald's continues to update its burger offerings. International markets showed varied performance, with a 4.4% growth in same-store sales in markets like Canada, Australia, and Germany.

For 2024, McDonald's plans to open over 2,100 new restaurants, contributing to a forecasted 2% growth in system-wide sales. The company intends to spend $2.5 to $2.7 billion on capital expenditures, with a significant portion allocated to expanding its U.S. and international presence.

🎯 GRIT TAKE: McDonald's has often served as an…upgrade to VIP to read the full GRIT Take. 

MCDONALDS: Earnings Are In

McDonald’s reported mixed results for its latest quarter, leading to a slight dip in shares by less than 1%. The company saw an increase in fourth-quarter net income to $2.04 billion, or $2.80 per share, with net sales up 8% to $6.41 billion. However, global comparable sales only grew by 3.4%, missing expectations due to the impact of the Israel-Hamas conflict on its Middle Eastern markets. In contrast, U.S. same-store sales rose by 4.3%, supported by price increases and digital sales growth.

Despite a slowdown in U.S. customer traffic previously attributed to higher prices, McDonald's continues to update its burger offerings. International markets showed varied performance, with a 4.4% growth in same-store sales in markets like Canada, Australia, and Germany.

For 2024, McDonald's plans to open over 2,100 new restaurants, contributing to a forecasted 2% growth in system-wide sales. The company intends to spend $2.5 to $2.7 billion on capital expenditures, with a significant portion allocated to expanding its U.S. and international presence.

🎯 GRIT TAKE: McDonald's has often served as an indicator of the broader economic climate. During the financial crisis of 2008-2009, the company saw its sales in the U.S. grow by an average of 3.4%, while in Europe, sales surged by 6.9%. Recently, McDonald's reported a decrease in spending per order among customers earning less than $45,000 annually. Conversely, there has been an uptick in customers from individuals with higher incomes who prefer McDonald's to traditional dine-in options, underscoring a general trend toward budgeting. As McDonald’s experiences sales growth, it’s interesting to observe how luxury brands might exhibit contrasting trends, which would suggest shifts in consumer spending habits.

Powell: Goes On 60 Minutes

Jerome Powell, Chair of the Federal Reserve, suggested that interest rate cuts may not occur until after March, as the Fed seeks more evidence that inflation is steadily moving towards the 2% target. In a CBS 60 Minutes interview, Powell conveyed the central bank's cautious approach to rate reductions, emphasizing the risk of acting too hastily before confirming a sustainable decline in inflation.

He indicated that the Federal Open Market Committee is unlikely to have enough confidence in inflation's trajectory by its March meeting. Despite speculation of a mid-year rate cut, Powell's comments led to a drop in Treasury yields, reflecting investor anticipation of swift rate decreases. Powell also noted that significant changes to the Fed's 2024 interest rate forecasts are not expected.

BOEING: More Problems

Boeing has discovered new issues with incorrectly drilled fuselage holes on its 737 Max jets, affecting about 50 undelivered planes. This problem, stemming from supplier Spirit AeroSystems Holdings, is set to delay the delivery of these aircraft models. This same model is already under strict regulatory watch due to previous quality issues.

The latest setback, which led to a 1.6% drop in Boeing's premarket shares, adds to the company's ongoing manufacturing challenges. Spirit Aero's shares also declined by 1.6% amidst a series of setbacks that have hampered Boeing's delivery schedules and contributed to a significant decline in its stock value this year.

Headlines You Need To Know: 🎙

• Senate releases $118 billion aid proposal

• Meta oversight board calls new rule incoherent

• 2026 World Cup Final will be held in NYC

• Estee Lauder surges on plan to cut 5% of workforce

• Taylor Swift makes Grammys history

• LVMH takes aim at the watch market

This Man Created $36 Million In Cash Out Of Thin Air…

William Rockefeller gave Marcus Daly a check for $39 million for the purchase of Anaconda Properties, but with one very strict condition. Daly could only put this check in National City Bank and could NOT deposit it until he said so. 

Rockefeller created a paper holding company called Amalgamated Copper Company and used their own secretaries as dummy directors. Amalgamated Copper immediately purchased Anaconda Copper for $75 million in an ALL-stock deal, and shares were magically created for this reason. 

Rockefeller went to National City Bank and got a loan for $39 million so he could cover the check that they gave Marcus Daly. The $75 million worth of Amalgamated Copper stock was used as collateral for the loan. 

Finally, they sold Amalgamated on the stock market, and with those proceeds, they paid off their National City Bank loan. 

When it was all said and done, Rockefeller cashed out $36 million. 

The wildest part? This was over 120 years ago, so there was no regulation; therefore, he never got charged with fraud.

Chart of the Day

📊 Tesla’s Global Sales

The author, publisher or insiders of the publisher may currently have long or short positions in the securities of the companies mentioned herein, or may have such a position in the future (and therefore may profit from fluctuations in the trading price of the securities). To the extent such persons do have such positions, there is no guarantee that such persons will maintain such positions.