McDonald's July same-store sales flat, worst in 9 years
By Lisa Baertlein and Brad Dorfman
(Reuters) - McDonald's Corp (MCD.N: Quote) reported flat sales in July at established restaurants around the world, its worst performance in more than nine years and a signal that a weakening global economy is taking a bite out of mainstream diners' discretionary spending.
The results came in far below Wall Street's expectation and marked the first time since April 2003 that sales at restaurants open at least 13 months did not rise.
Shares of the world's biggest hamburger chain were down 1.6 percent at $87.56 in midday trading. The stock has fallen more than 14 percent from its peak of $102.22 in January.
"We've grown used to seeing McDonald's weather bad economies, so this is a bit of a surprise," RBC Capital analyst Larry Miller said.
Just two weeks ago, McDonald's said it had expected worldwide July sales at restaurants open at least 13 months to rise, but not as much as the 3.7 percent gain reported in the second quarter.
Analysts polled by Consensus Metrix expected a gain of 2.3 percent and the flat result suggested that sales slowed in the days after McDonald's issued same-restaurant sales guidance on July 23.
"It's clear that the consumer is starting to cut back a little," Edward Jones analyst Jack Russo said.
After months of outpacing rivals, it appeared that McDonald's ceded a bit of market share in July. Continued...