U.S. consumer stocks: 1 buy & 1 hold

Article Excerpt

MCDONALD’S CORP. $163 (New York symbol MCD; Income-Growth Dividend Portfolio, Consumer sector, Shares outstanding: 775.8 million; Market cap: $126.5 billion; Dividend yield: 2.5%; Dividend Sustainability Rating: Highest; www.mcdonalds.com) is the world’s largest operator of fast-food restaurants, with 37,406 outlets in 120 countries. It serves a wide variety of food, but is best known for its hamburgers and french fries. Starting with the December 2017 payment, the company raised its quarterly dividend by 7.4%, to $1.01 a share from $0.94. The new annual rate of $4.04 yields 2.5%. McDonald’s recently announced that it will spend $6 billion over the next two years to update most of its U.S. restaurants. Key improvements will include modern seating areas, digital self-order kiosks and table service. Meantime, McDonald’s revenue in the quarter ended June 30, 2018, fell 11.5%, to $5.4 billion from $6.0 billion a year earlier. That’s mainly because the company continues to transfer outlets to its franchisees. Its aim is to have those partners operate 95% of locations, up…

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