2.5 Reasons to Hold On to McDonald's Stock

McDonald's sports a solid balance sheet, a well-covered dividend with room to grow, and a valuation that's not too far stretched.

Chuck Saletta
Chuck Saletta
Apr 8, 2014 at 12:45PM
Investment Planning

McDonald's (NYSE:MCD) is a selection for the real-money Inflation-Protected Income Growth portfolio. In this brief video, portfolio manager Chuck Saletta offers two-and-a-half reasons he's holding on to McDonald's stock despite its small rise since he bought those shares a little more than a year ago.

To summarize, McDonald's sports:

  • A decent balance sheet, with a debt-to-equity ratio around 0.9.
  • A well-covered dividend with a 56% payout ratio and a decent history of increasing that dividend.
  • A market cap that's not too far ahead of the iPIG portfolio's fair-value estimate.

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