McDonald's drops to two-year low as traffic weakens

McDonald's shares closed at $248.51 on Wednesday, down 1.69% for the session and falling 17.1% year to date. The move sank the stock to a two-year low, leaving it down 27% from its high of the year despite total U.S. retail sales climbing 1.2% in August to $773.9 billion.

The fast-food chain struggled with customer traffic in the second quarter. U.S. comparable sales rose just 0.8%, guest counts in the United States turned negative, and global comparable sales growth slowed to 1.3% from 3.8% a year earlier.

The slowdown reflects pressure on lower-income consumers, with University of Michigan consumer sentiment at 55.2 and credit card delinquencies at 2.85%. To defend market share, McDonald's rolled out an everyday affordable menu with items under $3 and a $4 breakfast meal deal. However, these value promotions drove selling, general, and administrative expenses up 17%.

Macroeconomic pressures are also weighing on investor demand. The 10-year U.S. Treasury yield touched 5.00% on 15 September, competing directly with McDonald's 2.91% dividend yield. Over the past 30 days, analysts logged 26 downward revisions against 3 upward adjustments for fiscal 2027 earnings per share, lowering the consensus estimate from $14.22 to $13.98.