synopsis

Analysts say McDonald's business has gained in recent months due to value meals and new menu items.

McDonald's is expected to report another revenue decline on Thursday, with its first-quarter results likely to shed light on the impact of tariffs and shifting consumer demand across the fast-food industry.

The restaurant sector is particularly susceptible to inflationary trends, and analysts have said most chains will likely report earnings below market expectations this season.

McDonald's, in contrast, has shown strength in recent months.

Value offerings such as "Buy One, Add One for $1" and new menu items, including the upcoming McCrispy Strips, Snack Wraps, and Real Lemonade, have drawn consumer interest.

Last week, Wells Fargo named McDonald's a key defensive stock in its food industry coverage.

In the Thursday's report, investors will still look for comments on tariff impact on prices and supply chain, consumer sentiment, and sales in key market China.

According to Koyfin data, analysts expect McDonald's to report a 0.7% decline in sales and an adjusted profit of $2.67 per share, compared to $2.70 last year.

On Stocktwits, retail sentiment dropped to 'neutral' from 'bullish' a week ago.

MCD sentiment and message volume as of April 29 | Source: Stocktwits

One user cautioned that more promos essentially mean lower revenue, and the company might "skate by this ER (earnings report) but the rest of the year will be a big correction."

Several analysts, including BofA, Evercore, and Barclays, have adjusted their targets on the company's shares in recent weeks.

McDonald's shares are up 8.5% so far this year.

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