Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

McDonald’s Corp. (NYSE:MCD)

Analysis of Profitability Ratios

Beginner level

Profitability Ratios (Summary)

McDonald’s Corp., profitability ratios

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Return on Sales
Gross profit margin 52.74% 51.30% 46.54% 41.45% 38.52%
Operating profit margin 43.03% 41.96% 41.86% 31.45% 28.12%
Net profit margin 28.59% 28.18% 22.75% 19.03% 17.82%
Return on Investment
Return on equity (ROE) 63.90%
Return on assets (ROA) 12.68% 18.06% 15.36% 15.11% 11.94%

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-03-01), 10-K (filing date: 2016-02-25).

Profitability ratio Description The company
Gross profit margin Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. McDonald’s Corp.’s gross profit margin ratio improved from 2017 to 2018 and from 2018 to 2019.
Operating profit margin A profitability ratio calculated as operating income divided by revenue. McDonald’s Corp.’s operating profit margin ratio improved from 2017 to 2018 and from 2018 to 2019.
Net profit margin An indicator of profitability, calculated as net income divided by revenue. McDonald’s Corp.’s net profit margin ratio improved from 2017 to 2018 and from 2018 to 2019.

Profitability ratio Description The company
ROE A profitability ratio calculated as net income divided by shareholders’ equity.
ROA A profitability ratio calculated as net income divided by total assets. McDonald’s Corp.’s ROA improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

Gross Profit Margin

McDonald’s Corp., gross profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in thousands)
Gross margin 11,115,300  10,786,000  10,620,800  10,204,700  9,789,200 
Revenues 21,076,500  21,025,200  22,820,400  24,621,900  25,413,000 
Profitability Ratio
Gross profit margin1 52.74% 51.30% 46.54% 41.45% 38.52%
Benchmarks
Gross Profit Margin, Competitors2
Booking Holdings Inc. 100.00% 100.00% 98.02% 96.01% 93.15%
Starbucks Corp. 67.83% 58.84% 59.63% 60.07% 59.36%

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-03-01), 10-K (filing date: 2016-02-25).

1 2019 Calculation
Gross profit margin = 100 × Gross margin ÷ Revenues
= 100 × 11,115,300 ÷ 21,076,500 = 52.74%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Gross profit margin Gross profit margin indicates the percentage of revenue available to cover operating and other expenditures. McDonald’s Corp.’s gross profit margin ratio improved from 2017 to 2018 and from 2018 to 2019.

Operating Profit Margin

McDonald’s Corp., operating profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in thousands)
Operating income 9,069,800  8,822,600  9,552,700  7,744,500  7,145,500 
Revenues 21,076,500  21,025,200  22,820,400  24,621,900  25,413,000 
Profitability Ratio
Operating profit margin1 43.03% 41.96% 41.86% 31.45% 28.12%
Benchmarks
Operating Profit Margin, Competitors2
Booking Holdings Inc. 35.48% 36.77% 35.79% 27.05% 35.33%
Starbucks Corp. 15.38% 15.71% 18.47% 19.57% 18.79%
Operating Profit Margin, Sector
Travel & Leisure 29.52% 29.94% 31.48% 26.15% 26.03%
Operating Profit Margin, Industry
Consumer Services 7.83% 8.04% 8.34% 8.43% 8.55%

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-03-01), 10-K (filing date: 2016-02-25).

1 2019 Calculation
Operating profit margin = 100 × Operating income ÷ Revenues
= 100 × 9,069,800 ÷ 21,076,500 = 43.03%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Operating profit margin A profitability ratio calculated as operating income divided by revenue. McDonald’s Corp.’s operating profit margin ratio improved from 2017 to 2018 and from 2018 to 2019.

Net Profit Margin

McDonald’s Corp., net profit margin calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in thousands)
Net income 6,025,400  5,924,300  5,192,300  4,686,500  4,529,300 
Revenues 21,076,500  21,025,200  22,820,400  24,621,900  25,413,000 
Profitability Ratio
Net profit margin1 28.59% 28.18% 22.75% 19.03% 17.82%
Benchmarks
Net Profit Margin, Competitors2
Booking Holdings Inc. 32.29% 27.52% 18.46% 19.87% 27.66%
Starbucks Corp. 13.58% 18.28% 12.89% 13.22% 14.39%
Net Profit Margin, Sector
Travel & Leisure 23.13% 23.96% 18.00% 17.01% 18.29%
Net Profit Margin, Industry
Consumer Services 5.03% 5.07% 6.37% 5.14% 4.68%

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-03-01), 10-K (filing date: 2016-02-25).

1 2019 Calculation
Net profit margin = 100 × Net income ÷ Revenues
= 100 × 6,025,400 ÷ 21,076,500 = 28.59%

2 Click competitor name to see calculations.

Profitability ratio Description The company
Net profit margin An indicator of profitability, calculated as net income divided by revenue. McDonald’s Corp.’s net profit margin ratio improved from 2017 to 2018 and from 2018 to 2019.

Return on Equity (ROE)

McDonald’s Corp., ROE calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in thousands)
Net income 6,025,400  5,924,300  5,192,300  4,686,500  4,529,300 
Shareholders’ equity (deficit) (8,210,300) (6,258,400) (3,268,000) (2,204,300) 7,087,900 
Profitability Ratio
ROE1 63.90%
Benchmarks
ROE, Competitors2
Booking Holdings Inc. 82.00% 45.51% 20.79% 21.74% 29.01%
Starbucks Corp. 386.34% 52.93% 47.89% 47.39%
ROE, Sector
Travel & Leisure 390.70% 77.50% 71.40% 45.33%
ROE, Industry
Consumer Services 20.83% 21.33% 27.27% 21.40% 20.06%

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-03-01), 10-K (filing date: 2016-02-25).

1 2019 Calculation
ROE = 100 × Net income ÷ Shareholders’ equity (deficit)
= 100 × 6,025,400 ÷ -8,210,300 =

2 Click competitor name to see calculations.

Profitability ratio Description The company
ROE A profitability ratio calculated as net income divided by shareholders’ equity.

Return on Assets (ROA)

McDonald’s Corp., ROA calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in thousands)
Net income 6,025,400  5,924,300  5,192,300  4,686,500  4,529,300 
Total assets 47,510,800  32,811,200  33,803,700  31,023,900  37,938,700 
Profitability Ratio
ROA1 12.68% 18.06% 15.36% 15.11% 11.94%
Benchmarks
ROA, Competitors2
Booking Holdings Inc. 22.73% 17.62% 9.20% 10.76% 14.65%
Starbucks Corp. 18.73% 18.70% 20.08% 19.66% 22.15%
ROA, Sector
Travel & Leisure 16.44% 18.13% 14.15% 14.79% 14.51%
ROA, Industry
Consumer Services 5.78% 6.13% 8.54% 6.92% 6.80%

Based on: 10-K (filing date: 2020-02-26), 10-K (filing date: 2019-02-22), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-03-01), 10-K (filing date: 2016-02-25).

1 2019 Calculation
ROA = 100 × Net income ÷ Total assets
= 100 × 6,025,400 ÷ 47,510,800 = 12.68%

2 Click competitor name to see calculations.

Profitability ratio Description The company
ROA A profitability ratio calculated as net income divided by total assets. McDonald’s Corp.’s ROA improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.