Earnings Preview: McDonald's Corp.

By ASHLEY M. HEHER

posted: 36 DAYS 13 HOURS AGO

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CHICAGO -McDonald's Corp. reports results for the third quarter on Thursday. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: During the third quarter, McDonald's rolled out its long-touted $4 Angus burger nationwide in July. The Oak Brook, Ill.-based company, like many of its competitors adding products, hopes the "bigger, premium" burger lures customers who are looking for a sit-down restaurant-style meal without the higher price tag.

The world's largest fast-food chain said sales in restaurants open at least a year climbed 4.3 percent in July and 2.2 percent in August.

In other news, McDonald's said it will establish a European headquarters in Geneva, Switzerland by the end of 2009.

The restaurant chain also raised its quarterly dividend 10 percent to 55 cents.

The previous quarterly dividend was 50 cents.

BY THE NUMBERS: Analysts polled by Thomson Reuters predict a profit of $1.11 per share on revenue of $6.10 billion for the quarter. In the same period a year earlier, McDonald's earned $1.19 billion, or $1.05 per share, on revenue of $6.27 billion.

ANALYST TAKE: Jeffries analyst Jeff Farmer said he thinks a weak U.S. dollar will help overseas operations at McDonald's, which he expects will earn $1.13 per share during the period.

WHAT'S AHEAD: Analysts will be looking for updates on how October sales are faring, especially amid competition for fast food customer's that as heated as ever. Analysts will also hope to find out how unemployment trends are affecting sales, particularly the company's breakfast business, which has slowed as more people are out of work.

STOCK PERFORMANCE: During the quarter, which began July 1, shares fell less than 1 percent to end at $57.07. In the last 52 weeks, they've traded between $50.44 and $64.46.

2009-10-20 19:20:48