How to Own McDonald’s at a Discounted Price, According to Leading Financial Newsletter Profit Confidential

Share Article

According to George Leong, contributor to Profit Confidential, at the current level for the stock in McDonald’s Corporation, the top growth has been discounted into the price of the shares. But Leong believes you can still play the growth of McDonald’s through Arcos Dorados Holdings Inc.

How to Own McDonald's at a Discounted Price, According to Leading Financial Newsletter Profit Confidential

How to Own McDonald's at a Discounted Price, According to Leading Financial Newsletter Profit Confidential

Leong speculates there is a mispricing of Arcos Dorados in the marketplace, probably due to the fact the stores are situated in Latin America.

Past News Releases

RSS

According to George Leong, contributor to Profit Confidential, at the current level for the stock in McDonald’s Corporation, the top growth has been discounted into the price of the shares. But Leong believes you can still play the growth of McDonald’s through Arcos Dorados Holdings Inc.

“Arcos Dorados Holdings Inc. is the largest McDonald’s franchisee in the world based on system-wide sales and number of restaurants,” says Leong.

In the article “McDonald’s: Extending its Huge Success by Building a Global Cult Following,” Leong notes that Arcos Dorados operates or franchises 1,840 McDonald’s-branded restaurants in 20 Latin American and Caribbean countries and territories.

Trading at $14.06 as of the close of June 18, 2012, the stock is down 52% from its 52-week high of $29.43, reports Leong. According to his stock analysis, Arcos Dorados vastly underperformed McDonald’s since October 2011.

Leong speculates there is a mispricing of Arcos Dorados in the marketplace, probably due to the fact the stores are situated in Latin America.

Leong notes that the price/earnings to growth (PEG) ratio for McDonald’s is 1.64, versus the more attractive PEG of 0.90 assigned to Arcos Dorados.

“While McDonald’s has been on an impressive upward trajectory, my stock analysis suggests that Arcos Dorados represents a potentially more rewarding risk-reward situation,” says Leong.

Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it “begged” its readers to get out of the housing market... before it plunged.

Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.

To see the full article and to learn more about Profit Confidential, visit http://www.profitconfidential.com.

Profit Confidential is Lombardi Publishing Corporation’s free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit http://www.profitconfidential.com.

Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Michael Lombardi
Follow us on
Visit website