A Valuation Study of McDonald’s —— Based on Price-Earnings Ratio and Price-Sales Ratio

Kemeng Zhou ()
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Kemeng Zhou: International Department Jinling High School

A chapter in Proceedings of the International Workshop on Navigating the Digital Business Frontier for Sustainable Financial Innovation (ICDEBA 2024), 2025, pp 471-481 from Springer

Abstract: Abstract The thesis studies the company McDonald’s, starting from a basic aspect of the analysis, containing its founding time, capital structure, major shareholders and a financial summary. It then focuses on its financial analysis, profit analysis and relative valuation. The financial analysis includes the business model of the company, business strategy and an analysis of its business segments. The revenue analysis of McDonald’s adopts the strategy of sub-market research, specifically analyzing its revenue growth points and bottlenecks. As for the relative valuation of the company, this paper adopts the price-earnings ratio (P/E) method, as well as price-sales ratio approach (P/S). In addition, during analysis and calculation, several fast-food companies in the market are selected for comparison. In view of the leading position of McDonald’s through the fast-food industry and the fluctuation of the current market environment, it is very necessary to do valuation analysis of McDonald’s as the valuation of the company has practical application value.

Keywords: Profit Analysis; Business Analysis; Relative Valuation (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-652-9_50

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DOI: 10.2991/978-94-6463-652-9_50

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