McDonald's (NYSE: MCD) October same-store sales were more treat than trick, scaring up an amazing performance. Digging up a promotion based on the old-school board game Monopoly also helped the fast-food chain contend nimbly against copious competition.
McDonald's same-store sales soared 6.5% in October. Broken down by region, U.S. same-store sales grew 5.6%, Europe rose 5.8%, and Asia/Pacific, Middle East and Africa jumped 5.3%.
Although some investors and analysts got bummed out by the weaker-than-expected U.S. figure, a 5.6% comps increase sounds pretty solid to me. Mickey D's management attributed some of the U.S. sales success to Monopoly's return.
McDonald's still faces a few flak attacks, judging by a recent San Francisco backlash against Happy Meals, but it's still a strong performer. It's competing admirably against traditional fast-food joints like Yum! Brands (NYSE: YUM), Burger King, and Wendy's/Arby's (NYSE: WEN). It's also more than holding its own against upscale quick-serve companies such as Starbucks (Nasdaq: SBUX) and Panera (Nasdaq: PNRA).
McDonald's price-to-earnings ratio of about 18 is a good bit lower than that of rival Yum! Brands. Yet its solid performance also beats out laggards like struggling Sonic (Nasdaq: SONC), which has a higher trailing P/E.
Short-term negativity about McDonald's performance in the U.S. in October seems silly. Given the fast food giant's strong numbers, especially in a lackluster economy plagued by high unemployment, Fools should always make room for McDonald's in their long-term portfolios. If you'd like to follow the Golden Arches' sizzling progress, add the company to My Watchlist by clicking here.
