McDonald’s will not put its properties in a REIT

To accomplish this, the company will take on more debt, said Kevin Ozan, CFO.

McDonald’s had plans to sell off its real estate to boost rental income from the business.

But McDonald’s nixed the idea of a real estate spinoff, a comment sure to disappoint a few investors who viewed such a move as a key strategy for increasing shareholder value.

After significant deliberation, Easterbrook said, company leaders determined that a Reit was not the best interest of shareholders. Although McDonald’s saw an increase last quarter, it wants to continue to trend upward, and although they did not take the advice of their investors by putting real estate into an REIT, the company believes it will see an increase soon. The next dividend is payable on December 15 to shareholders on record as of December 1.

The company also raised its quarterly dividend to 89 cents per share from 85 cents. The best fried-potato chip maker’s free cash flows (FCF) have increased 14% year-over-year (YoY) from $3.4 to $3.9 billion in the first three quarters. Finally, Vetr raised shares of McDonald’s Co. from a “sell” rating to a “hold” rating and set a $108.37 price objective for the company in a research note on Wednesday, October 28th. It is significantly higher than S&P 500 yield of 2%. Finally, Bank of America began coverage on shares of McDonald’s Co.in a report on Friday, October 2nd.

The dividend increase is part of McDonald’s plan to return more cash to shareholders. The previous savings target was $200 million less.

A few experts say McDonald’s stellar credit rating could result in real estate returns that are too low to be attractive.

Unlike Credit Suisse’s latest rating, based on the recent corporate insider activity of 24 insiders, corporate insider sentiment is negative on the stock. The firm has downgraded McDonald’s debt. The stock is now up 21% so far this year.

CEO, Steve Easterbrook, has stated that the company has done all that it can to cut back on costs. It has announced to refranchise 4,000 from earlier target of 3,500 restaurants by fiscal year 2018 end. The company, which is now 81 percent franchise-owned, will be 95 percent franchise-owned in less than three years.

Food chain has introduced different menus to lure U.S. clientele.

Mr. Easterbrook said it is “bringing customers into restaurants, lifting guest counts at lunch and creating a more positive mood around the brand”. The 12-month consensus target price for the stock is $115.05, which reflects an upside potential of 0.66% over the current price. Also, Wcg Management L.P. have 10.44% of their U.S. long stock exposure invested in the company for 250,835 shares.