Yesterday, the SEC fined Stephen Easterbrook, the former CEO of McDonald’s (MCD). Easterbrook will have to cough up $400K as a penalty for lying to MCD’s investors about the circumstances surrounding his termination in 2019. He is also barred from becoming an officer or director for the next five year. The stock fell slightly in reaction to the news, but analyst Jared Garber from Goldman Sachs (GS) is unmoved by the fine — and he maintained a Buy rating on MCD stock yesterday.
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Garber is joined by 17 other analysts who have given a Buy rating on MCD in the past three months. However, the stock does have a Hold from three other analysts, and the analyst consensus forecast of $287.27 represents only a 7.50% upside.
On the other hand, MCD has risen by 14.4% in the past three months. Investors are seemingly unimpressed by the charges against Easterbrook – he engaged in personal relationships with McDonald’s employees, and then misrepresented the reasons behind his termination from the company. Yet investors are still “lovin'” the stock.
Will McDonald’s Beat Earnings Again?
Meanwhile, McDonald’s has beat earnings for the past three quarters, and its “Perfect 10” Smart Score portends another market-beating quarter, to be reported on January 26.
