McDonald's Stock Model Projects 39.5 Percent Three Year Gain

McDonald's shares could gain 39.5 percent over three years if revenue expands and its valuation multiple partially recovers, according to a financial analysis published by Trefis on October 20, 2026. The projection highlights the company's sales growth, international operations, and restaurant expansion as the main drivers, even as weaker US performance presents a challenge.

McDonald's stock has lost 18.5 percent over the past year, including dividends, while the S&P 500 returned 17.4 percent, according to Trefis. Shares recently traded at $242.67, equivalent to 19.6 times earnings over the preceding 12 months. That price-to-earnings ratio is below the company's average of 24.7 at fiscal quarter ends over the past three years and represents its lowest level at a fiscal quarter end in the past decade.

Trefis estimates that the stock could reach $338.49 in three years under its financial scenario. The model assumes annual revenue growth of 7.9 percent, a net profit margin of 31.9 percent, and a price-to-earnings ratio of 21.6.

Under those assumptions, annual revenue would increase from $27.7 billion to $34.8 billion, while earnings would rise from $8.79 billion to $11.1 billion. The projected share price represents an increase of 39.5 percent from the current level used in the analysis, excluding dividends.

Revenue expansion accounts for approximately 68 percent of the projected share-price increase, according to Trefis. A higher valuation multiple contributes about 30 percent, while the assumed improvement in net margin plays only a minor role. The model therefore relies primarily on stronger business performance rather than a substantial recovery in investor valuation alone.

International operations and new restaurant openings are central to the growth assumptions. During fiscal 2025, revenue from International Operated Markets, the company's largest segment, increased 8.0 percent, compared with 1.8 percent growth in the United States, according to Trefis.

The company is also targeting approximately 2,600 gross restaurant openings by the end of 2026. However, pressure on consumer spending and higher development costs have pushed McDonald's goal of operating 50,000 restaurants worldwide back to 2028, the analysis said.

US sales remain a significant uncertainty. Comparable sales in the domestic market increased 0.8 percent in fiscal second-quarter 2026, falling short of management's expectations, and turned slightly negative in July. Management attributed most of the shortfall in customer visits to weak execution of its value offers.

When McDonald's reported its fiscal second-quarter results in August, management said it expected comparable sales growth in its two international segments to accelerate in fiscal third-quarter 2026. The company did not provide a full-year fiscal 2026 revenue forecast alongside those results.

Trefis also tested how different assumptions could affect the three-year projection. If annual revenue growth reaches 5.9 percent rather than 7.9 percent, the projected upside falls to 31.9 percent. If the final price-to-earnings ratio remains at 19.6 instead of rising to 21.6, the projected gain declines to 26.3 percent.

A net margin of 32.3 percent in the third year would increase the projected upside to 41.4 percent. Extending the same assumptions across five years would produce a modeled gain of 62.3 percent, according to the analysis.

The model also identifies conditions that could eliminate the projected return over three years, excluding dividends. With the other assumptions unchanged, revenue would need to contract by 3.5 percent annually, the net margin would need to fall to 22.9 percent, or the price-to-earnings ratio would need to decline to 15.5, depending on which variable changes.

Separately, Barron's published a technical analysis on October 19, 2026, projecting that McDonald's stock could rise 13 percent by the first quarter. The report also noted that negative headlines in France could obscure several potential growth opportunities, presenting a shorter-term outlook than the three-year financial model.

McDonald's fiscal third-quarter 2026 results are expected on or around November 4, 2026. Revenue growth and US comparable sales are among the key measures identified by Trefis for assessing whether the company's performance supports its longer-term valuation scenario.