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What's going on?
In October, we reported on the burgeoning recovery going on at American fast food giant McDonalds. Well, on Friday the company reported further positive results and the success has a lot to do with Egg McMuffins
What does this mean?
A good portion of McDonalds success is down to its introduction of All Day Breakfast in the US. People seem to really like it and its helping boost sales more than stock analysts expected. But its also its back to basics initiative, spearheaded by new CEO Steve Easterbrook, which has resulted in things like fewer order mistakes and faster drive thrus (in short, the customer service has improved). Its also had some success with a new 2-for-$5 promotional menu. The overall point is that this once lumbering company has been significantly transformed.
Why should I care?
For the stock: The stock has already jumped a lot. The stock is up almost 30% in the past year which is a heck of a lot for such a large, mature company. That reflects the successful turnaround that the CEO has led. Later in the year, hes expected to unveil a longer-term strategic plan and, at this stage, the future performance of the stock probably relies more on how that shakes out
For you personally: Technology is going to re-invent fast-food. In the very near future it will be routine for you to order via an app on your phone and just breeze into the store (or through the drive thru) to collect it. McDonalds and Starbucks are two companies that are likely to pioneer this on a large scale. Whichever companies nail this new, much more efficient process will, arguably, be the ones showing the greatest sales growth in years to come.
Originally posted as part of the Finimize daily email.
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