New value menu push and what it could mean for McDonald's (MCD) stock

McDonald's (MCD) is leaning into lower price points, with new menu items at $3 or less and $4 breakfast deals set to launch across the U.S. starting in April.

The company is targeting budget conscious diners at a time of economic pressure and tighter restaurant spending, using bundled value offers to support traffic while defending its brand position with cost sensitive households.

At a share price of $326.65, McDonald's has a 90 day share price return of 3.86% and a year to date share price return of 7.71%. The 5 year total shareholder return of 62.59% points to steady compounding through dividends and price gains, as the company leans on value driven promotions, viral brand moments and recent euro bond issuance to fund growth and franchise support.

If value menus are on your radar, it can be useful to see what else consumers are spending on, including 20 top founder-led companies

With McDonald’s delivering 6.8% U.S. same store sales growth in its strongest 2025 quarter and trading around $326.65 today, the key question for investors is whether there is still upside left, or if the market has already priced in future growth.

Most Popular Narrative: 37% Overvalued

Compared with the last close at $326.65, the most followed narrative pins McDonald's fair value at $238.97, creating a sizeable valuation gap in that framework.

📉Its modest revenue and EPS growth warrants some caution for the enxt couple of years. However, this is also justified by the maturity of the business and its mature growth / decline stage in its lifecycle. I don't see any competitors or disruption of its business in the horizon, however a new more health focused generation may start to put pressure on the company, it is something to watch out for.

Curious how a wide moat business with high returns on capital can still screen as expensive? The key ingredients are modest growth assumptions, rich cash flow projections and a valuation framework that leans heavily on long run profitability expectations.

Result: Fair Value of $238.97 (OVERVALUED)

However, this narrative could be challenged if U.S. same store sales slow from the recent 6.8% pace or if value deals pressure McDonald’s 35% profit margin.

Another View on McDonald's Valuation

The user narrative points to McDonald's being overvalued at a fair value of $238.97, yet our preferred earnings multiple paints a different picture. At a P/E of 27.1x versus peers at 54.2x and a fair ratio of 33.3x, the stock looks cheaper than both its peer group and that fair ratio suggests. This raises the question of whether the current level reflects a pricing premium or a potential misread of quality and risk.

Next Steps

Mixed messages on value or a balanced view of risks and rewards? Take a closer look at the data, act promptly, and weigh up the 3 key rewards and 1 important warning sign

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.