Stock Analysis on Net
Stock Analysis on Net
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McDonald’s Corp. (NYSE:MCD)

Price to FCFE (P/FCFE)

Intermediate level


Free Cash Flow to Equity (FCFE)

McDonald’s Corp., FCFE calculation

US$ in thousands

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12 months ended: Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Net income 6,025,400  5,924,300  5,192,300  4,686,500  4,529,300 
Net noncash charges 1,798,200  1,515,100  1,339,400  1,206,100  1,841,900 
Changes in working capital items 298,500  (472,700) (980,500) 167,000  167,900 
Cash provided by operations 8,122,100  6,966,700  5,551,200  6,059,600  6,539,100 
Capital expenditures (2,393,700) (2,741,700) (1,853,700) (1,821,100) (1,813,900)
Net short-term borrowings 799,200  95,900  (1,050,300) (286,200) 589,700 
Long-term financing issuances 4,499,000  3,794,500  4,727,500  3,779,500  10,220,000 
Long-term financing repayments (2,061,900) (1,759,600) (1,649,400) (822,900) (1,054,500)
Free cash flow to equity (FCFE) 8,964,700  6,355,800  5,725,300  6,908,900  14,480,400 

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).

Item Description The company
FCFE Free cash flow to equity is the cash flow available to McDonald’s Corp.’s equity holders after all operating expenses, interest, and principal payments have been paid and necessary investments in working and fixed capital have been made. McDonald’s Corp.’s FCFE increased from 2017 to 2018 and from 2018 to 2019.

Price to FCFE Ratio, Current

McDonald’s Corp., current P/FCFE calculation, comparison to benchmarks

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No. shares of common stock outstanding 744,102,514
Selected Financial Data (US$)
Free cash flow to equity (FCFE) (in thousands) 8,964,700 
FCFE per share 12.05
Current share price (P) 214.97
Valuation Ratio
P/FCFE 17.84
Benchmarks
P/FCFE, Competitors1
Booking Holdings Inc. 15.00
Starbucks Corp. 19.85
P/FCFE, Sector
Travel & Leisure 17.69
P/FCFE, Industry
Consumer Services 32.71

Based on: 10-K (filing date: 2020-02-26).

1 Click competitor name to see calculations.

If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.


Price to FCFE Ratio, Historical

McDonald’s Corp., historical P/FCFE calculation, comparison to benchmarks

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Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
No. shares of common stock outstanding1 745,446,655 765,317,332 794,497,880 818,993,182 901,607,888
Selected Financial Data (US$)
Free cash flow to equity (FCFE) (in thousands)2 8,964,700  6,355,800  5,725,300  6,908,900  14,480,400 
FCFE per share3 12.03 8.30 7.21 8.44 16.06
Share price1, 4 210.10 183.17 163.06 129.05 118.37
Valuation Ratio
P/FCFE5 17.47 22.06 22.63 15.30 7.37
Benchmarks
P/FCFE, Competitors6
Booking Holdings Inc. 15.41 24.98 15.00 17.25 11.84
Starbucks Corp. 20.35 5.44 26.95 18.49 33.79
P/FCFE, Sector
Travel & Leisure 17.74 12.26 20.35 16.75 11.58
P/FCFE, Industry
Consumer Services 25.70 13.33 18.00 19.18 14.91

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 Data adjusted for splits and stock dividends.

2 See details »

3 2019 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 8,964,700,000 ÷ 745,446,655 = 12.03

4 Closing price as at the filing date of McDonald’s Corp.’s Annual Report.

5 2019 Calculation
P/FCFE = Share price ÷ FCFE per share
= 210.10 ÷ 12.03 = 17.47

6 Click competitor name to see calculations.

Valuation ratio Description The company
P/FCFE Price to free cash flow to equity is cash valuation indicator of stockholders’ equity. McDonald’s Corp.’s P/FCFE ratio decreased from 2017 to 2018 and from 2018 to 2019.