Dividends in Focus: McDonald’s Corporation (MCD)

Shares of fast food giant McDonald’s Corporation (MCD) peaked in mid-April 2013 and have been on a steady decline since then. Let’s explore what’s in store for the company over the next 12 months, with a focus on dividends.

McDonald’s's Current Dividend Policy

MCD currently pays a quarterly dividend of 84 cents per share, or $3.24 on an annualized basis. Its dividend yield sits around 3.4%, which is toward the top of its historic range. Analysts expect 7% earnings growth for the company in 2014. Based on those projections, the company’s 2014 payout ratio is a healthy 54%. Thus, we see no stumbling blocks for McDonald’s to raise its dividend once again next year, likely beginning with its Q4 2014 payout.

Dividend.com DARS Ratings for McDonald’s Overall Rating:Neutral (3.4/5) Metric Rating Explanation

Relative Strength		Stock is performing in-line with the market or better.
Overall Yield Attractiveness		Stock’s dividend yield is adequate.
Dividend Reliability		This rating is related to the length and consistency of a company’s dividend payouts, as well as our opinion on how likely the company is to continue payouts in the future.
Dividend Uptrend		Dividend payouts are consistent, but increases small.
Earnings Growth		Earnings estimates are uptrending.