McDonald’s (MCD)

Mar 23, 2022Trade Ideas

McDonald’s (MCD) is incredibly oversold.

Not only is the stock sitting at double bottom support, but it’s also over-extended on RSI, MACD, and Williams’ %R. In fact, the last three times MCD became this oversold, the MCD rebounded. We saw that happen in January 2022, October 2020, and in March 2020.

From a current price of $238, we’d like to see it again test resistance around $261.

While restaurant closures in Russia dented the stock, it looks like a good deal of that negativity has been priced in, as well. Plus, MCD earnings have been solid. For example, Q4 revenue was up 13% year over year, thanks to a 12.3% jump in global comparable sales. In the U.S., comparable sales were up 7.5% year over year.

On the pullback, investors can pick up a solid stock on the cheap, and collect a dividend. At the moment, MCD carries a dividend yield of 2.32%.

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