Earlier today, McDonald’s management remarked on its Q4 earnings conference call that “with a strong US dollar that may continue to strengthen into 2025, we expect from foreign currency to be a full year headwind to 2025 EPS, totaling in the range of $0.20 to $0.30 based on current exchange rates.”
Earlier today (Monday), McDonald’s reported adjusted Q4 EPS of $2.83. This was fairly close to our $2.85 forecast and sell-side consensus (according to Consensus Metrix) of $2.84. We calculate that the adjusted Q4 tax rate was 19.9%. This was more favorable than our 20.5% projection and consensus of 20.6%. The lower-than-forecast tax rate helped Q4 EPS by about +2 cents, relative to our projection.
Earlier today, Yum Brands reported adjusted Q4 EPS of $1.61, coming in in-between our $1.63 forecast and sell-side consensus (according to Consensus Metrix) of $1.60. The Q4 adjusted tax rate was 25.1%. This was less favorable than our 22.0% projection and consensus at 21.8%. By our math, the difference between 25.1% and 22.0% hurt Q4 adjusted EPS by about -7 cents.