McDonald's Earnings

McDonald's (MCD), one of my portfolio holdings, was smacked today losing 6% today. The stock has been sliding since news came out two weeks ago that the company would post weak same store sales. It was the first non-growth sales report in 56 months.

Well, I think that Jim Skinner said it best, "We're recession-resistant, not recession-proof."

But some good news. Only 35% of McDonald's earnings are U.S. based. It was 58% in 1991. If the rest of the world can keep trucking along, which they all publicly say (but their markets say something totally different), then MCD should be just fine.

The stock is off it's 52 week high and is a solid stock to hold and hold for a long, long time. If my portfolio allowed for adding to a position, this would be a good time for me to do it and let it sit.

I do not see this one month flat sales or even a couple of slow months at the Golden Arches as a red flag of a sinking ship. Other fast food companies are struggling, including Wendy's. This is a strong company that has stated they are not going to get into a pricing war for burgers. They had innovated and changed their product offerings and that is why we have seen fantastic sales numbers over the last few years.

The company has also stated that they are going to start paying dividends on a quarterly basis.

There is just too much good in this company to turn away. The long term potential of this stock far outweighs any short term pressures the stock may face.