#5: McDonald’s (MCD)
Everybody is indisputably not lovin’ it when it comes to McDonald’s (MCD) this year. The world’s biggest burger chain has been stumbling with disappointing sales amid increased competition and changes to its dollar … er, value menu.
MCD is up just 12% for the year so far, lagging the broader market by a wide margin. If there’s a bright spot to that underperformance, it has the dividend throwing off a healthy 3.3% and the stock doesn’t look particularly expensive.
MCD trades essentially in line with its own five-year average forward P/E, according to data from Thomson Reuters Stock Reports. Not a steal, but not overpriced, either.
Like other laggard blue chips, MCD returns enough cash to shareholders through dividends and buybacks to make it an attractive equity income holding until its fortunes improve.