McDonald's cuts prices to win back customers. Why do analysts disagree?

McDonald's is cutting prices on combo sets after customer complaints and increasing competition, which is immediately reflected in investor sentiment. The company's shares are growing moderately in 2025: some analysts advise "hold", believing that the growth potential is almost exhausted, while others forecast a gain of 5-9%.

McDonald's will cut prices on popular combo sets after criticism from customers who complained the bigmacs were too expensive - at some restaurants, they cost as much as $18 along with a drink and fries, The Wall Street Journal reported.

The chain has reached an agreement with franchisees: the price of the eight most popular sets will be at least 15% lower than the sum of the individual items. Promotions will start as early as September - breakfasts for $5 and combos with a Big Mac or nuggets for $8.

According to McDonald's U.S. head Joe Erlinger, the company intends to reclaim its image as an affordable brand, "Customers are telling us they want more of the everyday value and affordability that has always been part of McDonald's."

McDonald's food prices have risen dramatically in recent years. For example, the average large set with a Big Mac now costs $10.5, and in some places it goes up to nearly $19. From 2019 to 2024, the cost of a Big Mac with a side dish and a drink has gone up 27%, the WSJ notes.

Fast food restaurants in general are losing customers: according to Black Box Intelligence, traffic in U.S. establishments has dropped by 2.7% since the beginning of the year. McDonald's is even willing to subsidize franchisees if they operate at a loss due to new discounts in order to win back customers, sources told WSJ.

All of these factors directly shape investor sentiment and affect stocks. In order to increase sales, McDonald's introduced a new Daily Double burger in July and brought back snack-rapes popular with customers.

This caused a positive reaction of Goldman Sachs: the investment bank raised the forecast on McDonald's and recommended the shares to buy, reported MarketWatch. Analyst Christine Cho expects that during the year the securities can grow by about 15%, as the company, despite price competition, is able to outperform rivals and strengthen its position in the market.

At the premarket on August 20, McDonald's shares are up almost 0.3%, and they are up about 9% since the beginning of 2025. The papers retain the interest of investors, but analysts' forecasts diverge.

According to Marketbeat Ratings, shares of McDonald's received a consensus rating of "hold" in mid-August from the 28 analyst firms that follow the company. Two analysts recommend "sell," 13 recommend "hold," and another 13 recommend "buy." The average target price is $326.87, which implies a potential upside of about 5.1% from the current $311.

TD Cowen analyst Andrew Charles raised his target price on McDonald's stock from $305 to $315 in early August, maintaining a "hold" rating. That forecast implies growth of just 1.3%, TipRanks notes.

Commenting on the company's improved U.S. sales and promotional activity, Charles said, "Every day something changes, but essentially everything stays the same."

According to TipRanks, ten analysts tracking McDonald's stock recommend "buy" it, ten recommend "hold" and two recommend "sell". The consensus rating remains a moderate "buy" with an average target price of $339 (upside +9%).

This article was AI-translated and verified by a human editor