McDonald's Beats Q4 Forecasts

McDonald's shares reached a seven-year high of $44.86 yesterday when the company reported Q4 profit well ahead of analyst expectations on higher sales of chicken wraps and a gain from the Chipotle Mexican Grill spin-off. Preliminary net income hit $1 a share from $0.48 last year ($0.61 excluding Chipotle) while global same-store sales rose 7.2%. Analysts were expecting $0.58. European same-store sales surged 8.2% in December on new products, the 11th consecutive month sales have increased. The company is considering further asset sales after the successful split from Chipotle. McDonald's has extended its hours, renovated restaurants, and introduced items like meal-sized salads and locally targeted dishes, like pasta salads in Italy. McDonald's will report complete Q4 and full-year results Jan. 24.

• Sources: Bloomberg, Reuters, MarketWatch
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• Potentially impacted stocks and ETFs: McDonald's Corp. (MCD). Competitors: Burger King Corporation (BKC), Yum! Brands Inc. (YUM). ETFs: Vanguard Consumer Discretionary ETF (VCR), iShares Dow Jones US Consumer Services (IYC), PowerShares Dynamic Food & Beverage (PBJ), Consumer Discretionary SPDR (XLY)