“Plastics” Not The Future At McDonald’s(MCD)

Posted by barkand on May 9, 2011 under Bollinger bands, Cartoons | Be the First to Comment

An article in the May 6 2011 edition of USA Today got our attention (McDonald’s Revamps Stores To Look More Upscale). A billion dollar makeover is coming to many McDonald’s stores, which includes wood furniture and softer colors.  The article includes this quote from the editor of BurgerBusiness:

“The trick is to go techno without going Jetsons.”

We immediately recognized this as an opportunity to have the one and only Judy Jetson to make an appearance on this blog.  That’s her to the right, apparently dining at a futuristic McDonald’s.

This blog is about technical analysis, so let’s look at a chart of MCD. Below is a 30 year history of the stock. Notice how the shares went from seemingly nothing to its current price near $80. The Great Crisis barely registers on the chart. However, the stock did lose two-thirds of its value from 1999 to 2003.

What is interesting to us is that the stock has been riding up the upper Bollinger band almost constantly since 2005 – but for the crisis related period in 2009. The shares hit $80 late last year and pulled back. Will prices ultimately go higher? It probably depends alot on how the new look is received by customers.

But one thing we are sure of: You will see it in the chart first before the fundamentals give us any information.