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Why Own McDonalds Stock?
McDonalds stock (MCD) has slipped a bit of late but many analysts are expecting a comeback based on changes in the business, share repurchases, and higher dividends. McDonalds is a lot like Microsoft. It is the largest and most profitable in its niche and has little room to grow. So, why own McDonalds stock? It is unlikely to double or triple in value and, some believe, only has a downside risk. McDonalds is a stalwart. It is a mega large cap stock with stability, international name recognition and lots of cash. It is one of the great dividend stocks of the widows and orphans variety. Take a look at MCD stock price over the last two decades and you will see that it has gone from $12 a share to the $80 to $100 range with two splits along the way. Thus the current $97 share price is on a stock that sold for $3 a share two decades ago. The company currently pays a dividend of 3.24 percent a year which is twelve percent on a 1993 share. This looks like the reason that people leave their money in strong stocks and answers the question why own McDonalds stock, at least for conservative investors.