McDonald's Faces Sales Decline Amid Market Challenges

McDonald’s has reported its weakest comparable sales growth in five years, with domestic demand falling and same-store sales in the U.S. dropping 3.6% year-over-year, reflecting broader industry headwinds and consumer pullback at the lower end. Despite these challenges, the stock has remained resilient, partly due to continued spending from higher-income customers and optimism surrounding value offerings like the $5 meal deal. However, analysts caution that the company's premium valuation may not be justified given recent bearish trends and mixed Q1 results, with some predicting potential underperformance if growth continues to be bumpy. Wall Street remains generally supportive, with a consensus 'Moderate Buy' rating and price targets ranging from neutral to bullish, though recent earnings missed analyst expectations and revenue fell 3.5% year-over-year. Internationally, the company faces headwinds from anti-American sentiment and economic uncertainty linked to U.S. tariff policies, though management is working to expand market share through value promotions. Overall, while McDonald's retains some defensive appeal in uncertain times, its near-term outlook is clouded by weak consumer demand and increased price competition.