As sort of a part two to my McDonald's (MCD) article entitled Nobody Goes To McDonald's Anymore: It's Too Crowded, my goal here is to show by example the mass media hysteria that is anti-McDonald's through (probably unintentional) ignorance. Click on this thestreet.com video to see what I mean.
During the video, Brian Sozzi declares, "Burger King (BKW) is winning the global burger wars against McDonald's." With all due respect, Sozzi, are you joking? Granted, the stock price of Burger King is blowing away McDonald's this year, but we're talking about the "burger wars" and not the "stock price wars." He even goes on to say that Burger King is "dismantling McDonald's army." Wow, powerful words.
No doubt Burger King is making some gains, albeit very small, on McDonald's, but it's a far cry from winning anything. Using the war analogy, Burger King is like a band of rebels against the Roman Empire. Maybe Burger King took out a few soldiers but the army is still vast and strong while Burger King by comparison is just a nuisance.
Last quarter for example, McDonald's amassed $1.4 billion in net income on $7.2 billion in revenue. Burger King made $75 million on $262 million in revenue. In other words, McDonald's has nearly 100 times more in net income and nearly 30 times as much revenue.
Using a baseball analogy, it would be like losing 30 to 0 or 100 to 0 one game, then "improving" to a 30 to 2 or 100 to 2 loss and calling it a victory. If this is Burger King "winning" the burger wars and dismantling McDonald's, I'd hate to see losing.