prev

REPLAY | LONG MCD BLACK BOOK PRESENTATION

Long MCD – 7/8/15 Call Replay and Slides

Link to Audio Replay

Link to Video Replay

Link to Slide Deck

(If you have any issues accessing the replay, please email )

 

Our LONG thesis on McDonald’s is focused on three key points:

 

REPLAY | LONG MCD BLACK BOOK PRESENTATION - Chart 1 Slide 5

 

MCD has given up a lot of share to competitors as they have made many self-inflected wounds. We think that with the new CEO and the right initiatives in place they will reverse this trend, and steal back the share they lost.

 

REPLAY | LONG MCD BLACK BOOK PRESENTATION - Chart 2 slide 36

 

Sales trends have been dismal over the last few years, and if you had to choose one thing to blame it on it would MCD’s lack of value. MCD has drifted away from providing value to their customers, but they are returning to the value message now with national advertising.

 

REPLAY | LONG MCD BLACK BOOK PRESENTATION - Chart 3 slide 56

 

The menu was getting too complicated, it is very apparent that as the menu increases in size, sales decline.

 

REPLAY | LONG MCD BLACK BOOK PRESENTATION - Chart 4 slide 63

 

Reducing CAPEX is going to be a big accelerator of growth. We used SBUX as an example, once they cut CAPEX, focused on their current stores and closed underperforming ones, you see a drastic increase in EBITDA growth. We expect to see the same from MCD as they close stores and reduce CAPEX.

 

REPLAY | LONG MCD BLACK BOOK PRESENTATION - Chart 5 Slide 78

 

We see very minimal downside in the stock given it has been trading so far below its peers for the last 3-5 years.

 

REPLAY | LONG MCD BLACK BOOK PRESENTATION - Chart 6 Slide 104


O’Rourke: Gaming the Chances and Implications of ‘Grexit’

 

In this HedgeyeTV special, Jones Trading Chief Market Strategist Mike O’Rourke explains to Hedgeye interns what he’s focusing on and the related investing implications as the debt crisis in Europe reaches a crescendo.

 

Subscribe to Hedgeye on YouTube for all of our free video content.

 


McCullough: A Demographic 'Train Wreck' In China

Former New York City Mayor Rudy Giuliani, Hedgeye Risk Management CEO Keith McCullough and XLR-8 Founder Bob Nardelli discussed the implications of China’s stock selloff and economic headwinds facing Beijing with Maria Bartiromo on Fox Business.

Click image to watch.

McCullough: A Demographic 'Train Wreck' In China - z km


get free cartoon of the day!

Start receiving Hedgeye's Cartoon of the Day, an exclusive and humourous take on the market and the economy, delivered every morning to your inbox

By joining our email marketing list you agree to receive marketing emails from Hedgeye. You may unsubscribe at any time by clicking the unsubscribe link in one of the emails.

MATERNITY TRACKER UPDATE | JULY -1.7%

Takeaway: Births slowing, although 2Q15 looking better than we initially anticipated.

MATERNITY TRACKER UPDATE |  JULY -1.7%  - maternity tracker July 2015

NATIONAL AND LOCAL SLOWING

Our Maternity Tracker continues to update with high frequency.  The data appears to run with a high degree of fidelity with CDC birth data reported through December 2014 with an R-square of 0.89.  

 

The Maternity Tracker shows a slowing trend across the months of April to July.  The April trend has been updated to cover a significant data gap we uncovered during our validation process.  As a result, April 2015 reversed what we believed previously to be a negative trend to +1.8% nationally.  

MD & HCA SLOWING

MD: We remain short MD, but the maternity trend has not developed to the downside at our previously anticipated pace for 2Q15. Our best estimate for 2Q15 is +0.7% based on the state-weighted trend.  We will be reviewing other data including ACA Tracker data (published shortly) and the Delivery Index from the June OB/GYN Survey (published shortly).

 

HCA: The state-weighted growth rate for HCA is starting off 2Q15 strong, but has since weakened alongside national trends.  Similar to MD, we'll be rolling up additional data to look at the probability of a positive pre-announcement for 2Q15.  Our preliminary look at Medicaid enrollment, per enrollee spending as well as the JOLTS data released yesterday, suggest the answer is yes, but we'll have more later.  We covered this data yesterday in the studio -->  CLICK HERE

 

MATERNITY TRACKER UPDATE |  JULY -1.7%  - MD HCA table maternity tracker

 

Thomas Tobin

Managing Director 

@HedgeyeHC

 

Andrew Freedman

Analyst

@HedgeyeHIT 

 


Keith McCullough Walks Through Real-Time Alerts at 2:00PM ET

Hedgeye CEO Keith McCullough will answer your questions about Real-Time Alerts live today at 2:00PM ET. 

 

 
 

 

Get involved! There are two ways you can ask Keith questions:

  • Tweet us your questions via @Hedgeye with the #RTALive hashtag 
  • Ask questions in the chat box below the video player

If you are unable to watch this live, the replay will be available at the same link immediately following the completion of the show.



Daily Trading Ranges

20 Proprietary Risk Ranges

Daily Trading Ranges is designed to help you understand where you’re buying and selling within the risk range and help you make better sales at the top end of the range and purchases at the low end.

next