Aureus
BGood

McDonald's Corporation(MCD)

B

Financial data as of Dec 31, 2025Declining · Consumer Discretionary

FCF Margin26.1%Free Cash Flow / Revenue
Cash Conversion123.2%Operating CF / Net Income
Free Cash Flow$7.2B
Revenue$26.9B
Net Cash-$54.0BNet debt position
Debt / FCF7.8xElevated debt burden
Current Ratio0.95Tight short-term liquidity
YoY FCF Growth-10.1%5 of 5 quarters positive

How This Grade Was Calculated

Base grade from FCF margin, adjusted by financial health factors

BaseA
→
-1High debt-to-FCF ratio (7.8x)
→
+0.5Healthy FCF margin with manageable debt (26.1%, 7.8x)
→
-1Current ratio below 1.0 (0.95)
→
+0.5Highly consistent quarterly FCF
→
FinalB

Analysis Summary

Strengths

  • Exceptional FCF margin (26.1%)
  • Excellent cash conversion (123%)
  • Highly consistent quarterly FCF
  • Strong FCF margin (26.1%) despite slight YoY dip

Concerns

  • Heavy debt position ($54.0B net debt, 7.8x FCF)
  • High debt-to-FCF ratio (7.8x)
  • Current ratio below 1.0 — tight short-term liquidity

Financial Breakdown

Key financials compared side by side

Margin Composition

FCF Margin26.1%
Net Margin31.9%
Operating CF Margin39.2%
CapEx Ratio12.5%

Balance Sheet Health

Debt, liquidity, and leverage snapshot

Net Cash-$54.0BNet debt position
Debt / FCF7.8xElevated debt burden
Current Ratio0.95Tight liquidity
Debt / Equity0.00Low leverage

Quarterly FCF Trend

-10.1% YoYDeclining (-10.1%)

Free cash flow per quarter

Sector Comparison — Consumer Discretionary

FCF Margin ranked against sector peers

View all →

Detailed Metrics

Company NameMcDonald's Corporation
SectorConsumer Discretionary
Free Cash Flow$7.2B
Revenue$26.9B
Net Income$8.6B
Operating Cash Flow$10.6B
Capital Expenditure$3.4B
FCF Margin26.1%
Cash Conversion Rate123.2%
Net Margin31.9%
Total Debt$54.8B
Total Cash$774.0M
Net Cash-$54.0B
Current Ratio0.95
Debt / Equity0.00
Debt / FCF7.8x
YoY FCF Growth-10.1%
Positive Quarters5 of 5
Trend DirectionDeclining
Report DateDec 31, 2025
GradeB
Data SourceYahoo Finance

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