Old Burgers Aren't This Stock's Only Problem

You've likely heard by now that McDonald's (MCD) is changing its burgers... Among other things, the fast-food giant is switching to brioche buns for its signature Big Mac. It will also cook the patties in smaller batches. And it's tweaking many ingredients. [Chaikin PowerFeed]( Old Burgers Aren't This Stock's Only Problem By Vic Lederman, editorial director, Chaikin Analytics You've likely heard by now that McDonald's (MCD) is changing its burgers... Among other things, the fast-food giant is switching to brioche buns for its signature Big Mac. It will also cook the patties in smaller batches. And it's tweaking many ingredients. In short, McDonald's is doing all these things to try to create a "fresher" burger. This isn't the first time the company has refreshed its menu, of course. Through the years, it has tried everything from Angus Third Pounders and "all-day breakfast" marketing campaigns to the McCafé concept that led to a flourishing coffeehouse-style brand. Still, the coming changes to its burgers are big. And folks, this move is a gamble... Whenever a company messes with a beloved consumer product, it risks creating the next "New Coke." That was Coca-Cola's (KO) failed attempt to reformulate its product in 1985. So with that in mind, let's look closer at McDonald's today... The stock fell about 17% from early July through mid-October. But it has popped higher since then. That makes right now the perfect time to use the Power Gauge to dig deeper... Recommended Links: [Sell all your stocks before 2024?]( For the first time since the Great Depression, this insidious economic indicator is flashing RED. A massive move in stocks could soon follow. It’s time to brace yourself for one of the most bewildering and devastating years in financial history. [Here’s exactly what to do with your money to prepare now](. [Billionaires Now FLOODING Into Gold]( Ray Dalio, John Paulson, and many others all recommend you own gold right now. But did you know there's another huge investor (worth more than all the world's billionaires COMBINED) buying gold by the ton? That's why the best move to make right now could be this little-known gold investment (which you can get started with for just $5). [Click here for No. 1 gold recommendation](. Regular Chaikin PowerFeed readers know that the Power Gauge is our 20-factor investing model. It covers four main categories – Financials, Earnings, Technicals, and Experts. The Power Gauge weighs the 20 factors using a proprietary system based on Chaikin Analytics founder Marc Chaikin's decades of Wall Street experience. And in the end, it produces a "bullish," "bearish," or "neutral" rating for every stock in its universe. Beyond that, the "neutral" category is split into three different levels... • Neutral • Neutral+ • Neutral- Notably, McDonald's receives a "neutral-" rating today... [Chaikin PowerFeed] Next, let's look at the one-year chart. Notice the pullback and rally I mentioned earlier... [Chaikin PowerFeed] Put simply, McDonald's has struggled to keep up with the broad market this year. The stock is up roughly 7% in 2023. But the S&P 500 Index has soared around 20%. This underperformance is clear in the "relative strength" panel below the main chart. McDonald's currently earns "bearish" grades in the Earnings and Technicals categories. And worse still, the company receives a "very bearish" rating in the Financials category. When the Power Gauge puts all the data together, McDonald's would get a "bearish" overall rating. But as anyone who trades stocks knows... the trend is still the trend. Sometimes, "bullish" stocks go down. If the trend turns far enough against these stocks, the Power Gauge flags them with a "neutral+" rating. Other times, "bearish" stocks go up. If the trend moves far enough in these stocks' favor, the Power Gauge flips to a "neutral-" grade. That's exactly what we're seeing with McDonald's today... The gray dotted line on the previous chart is the stock's long-term trend line. And as you can see, the latest rally for McDonald's pushed it above this line in mid-November. In other words, the stock is currently above its long-term trend line. In response, the Power Gauge bumped it to a "neutral-" rating. That's how we know that our system acknowledges both the stock's trend and its lackluster grades at the same time. McDonald's could be in the early stages of a turnaround. As we've discussed today, the fast-food giant is in the middle of a major revamp. That move could be good for the long term. But the Power Gauge urges us to be careful. So keep McDonald's on your watch list for now. Good investing, Vic Lederman Market View Major Indexes and Notable Sectors # Hld: Bullish Neutral Bearish Dow 30 +0.850% 11 17 2 S&P 500 +0.580% 158 281 58 Nasdaq +0.280% 38 53 8 Small Caps +2.920% 612 953 358 Bonds +1.880% Real Estate +2.100% 3 24 4 — According to the Chaikin Power Bar, Large Cap stocks and Small Cap stocks are Bullish.. Major indexes are mixed. * * * * Sector Tracker Sector movement over the last 5 days Real Estate +4.65% Materials +2.75% Industrials +2.25% Financial +2.15% Discretionary +1.67% Utilities +1.34% Staples +0.77% Information Technology +0.63% Health Care +0.53% Energy +0.07% Communication -1.48% * * * * Industry Focus Software & Services 99 42 2 Over the past 6 months, the Software & Services subsector (XSW) has outperformed the S&P 500 by +2.31%. Its Power Bar ratio, which measures future potential, is Very Strong, with more Bullish than Bearish stocks. It is currently ranked #4 of 21 subsectors and has moved down 1 slot over the past week. Top Stocks [rating] ALRM Alarm.com Holdings, [rating] RAMP LiveRamp Holdings, I [rating] ZM Zoom Video Communica * * * * Top Movers Gainers [rating] BXP +11.15% [rating] ULTA +10.81% [rating] PARA +9.81% [rating] WBD +8.42% [rating] ETSY +8.22% Losers [rating] PFE -5.12% [rating] INTC -2.15% [rating] NFLX -1.74% [rating] ANET -1.40% [rating] CHD -1.30% * * * * Earnings Report Reporting Today Rating Before Open After Close SAIC DOCU, GTLB DG No earnings reporting today. Earnings Surprises No significant Earnings Surprises in the Russell 3000. * * * * You have received this e-mail as part of your subscription to PowerFeed. If you no longer want to receive e-mails from PowerFeed, [click here](. You’re receiving this e-mail at {EMAIL}. For questions about your account or to speak with customer service, call [+1 (877) 697-6783 (U.S.)](tel:18776976783), 9 a.m. - 5 p.m. Eastern time or e-mail info@chaikinanalytics.com. Please note: The law prohibits us from giving personalized investment advice. © 2023 Chaikin Analytics, LLC. All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from Chaikin Analytics, LLC. 201 King Of Prussia Rd., Suite 650, Radnor, PA 19087. [www.chaikinanalytics.com.]( Any brokers mentioned constitute a partial list of available brokers and is for your information only. Chaikin Analytics, LLC, does not recommend or endorse any brokers, dealers, or investment advisors. Chaikin Analytics forbids its writers from having a financial interest in any security they recommend to our subscribers. All employees of Chaikin Analytics, LLC (and affiliated companies) must wait 24 hours after an investment recommendation is published online – or 72 hours after a direct mail publication is sent – before acting on that recommendation. This work is based on SEC filings, current events, interviews, corporate press releases, and what we've learned as financial journalists. It may contain errors, and you shouldn't make any investment decision based solely on what you read here. It's your money and your responsibility.