McDonald's (NYSE:MCD) is set to report fourth-quarter earnings before the market opens on Friday. The fast-food giant has suffered lately from comparable-sales declines in the U.S. and Europe, as well as food safety issues in China. Investors are hoping for a strong Q4 as proof that McDonald's turnaround efforts are finally underway. McDonald's stock is down about 4% over the past year, and it could decline further if management fails to regain investor confidence.

Let's look at Wall Street's estimates for the quarter and whether Mickey D's can over-deliver on those projections.

Low expectations
Analysts expect McDonald's to post a profit of $1.22 per share in the fourth quarter, down from earnings per share of $1.40 in the year-ago period. And the Street's outlook for quarterly revenue in the period isn't much better. Analysts forecast fourth-quarter sales to decline 5.80% to $6.68 billion, down from $7.09 billion last year.

What's more, McDonald's has only topped the Street's estimates in one of the past four quarters. While past performance is not indicative of the future, it doesn't lend much credibility to McDonald's comeback strategy. "We recognize that we must demonstrate to our customers and the entire McDonald's System that we understand the problems we face and are taking decisive action to fundamentally change the way we approach our business," said Don Thompson, president and chief executive.

Source: The Motley Fool.

As part of its turnaround plan, the fast-food chain is implementing a new marketing approach and digital strategy, simplifying its menu while also offering more "locally relevant menu options," and renovating dozens of restaurants. Management has been executing these changes throughout much of fiscal 2014 in hopes of reinvigorating sales and profitability.

Still, it's not likely that McDonald's will surprise Wall Street with better-than-expected results when it reports tomorrow. Many of McDonald's turnaround initiatives will take time to play out. Specifically, menu innovation, which requires careful consideration from the company's management team in order to avoid potential pitfalls with respect to capital, labor, and execution risks. Therefore, McDonald's should continue to face challenges in fiscal 2015 as management attempts to right the ship.

Nonetheless, despite these near-term challenges, the stock looks like a smart long-term play for patient investors. Shares currently trade around $90 apiece, or near the low end of the stock's 52-week range. Not to mention the stock now trades at just 17 times earnings, which is well below the industry average P/E of 28 today. McDonald's probably won't impress Wall Street when it reports earnings tomorrow. However, long-term investors should see the company's turnaround really take hold in the year ahead.