McDonald’s Stock Capital Return Hits $35 Bil
In the last five years, McDonald’s (MCD) stock has returned $35 Bil back to its shareholders through cold, hard cash via dividends and buybacks. Let’s look at some numbers and compare how this payout power stacks up against the market’s biggest capital-return machines.
As it turns out, MCD stock has returned the 48th highest amount to shareholders in history.
| MCD | S&P Median | |
|---|---|---|
| Dividends | $23 Bil | $3.0 Bil |
| Share Repurchase | $13 Bil | $3.0 Bil |
| Total Returned | $35 Bil | $6.0 Bil |
| Total Returned as % of Current Market Cap | 16.2% | 16.8% |
Why should you care? Because dividends and share repurchases represent direct, tangible returns of capital to shareholders. They also signal management’s confidence in the company’s financial health and ability to generate sustainable cash flows. And there are more stocks like that. Here is a list of the top 10 companies ranked by total capital returned to shareholders via dividends and stock repurchases.
Top 10 Stocks By Total Shareholder Return
| Total Money Returned | As % Of Current Market Cap | via Dividends | via Share Repurchases | |
|---|---|---|---|---|
| AAPL | $514 Bil | 13.4% | $75 Bil | $439 Bil |
| GOOGL | $296 Bil | 7.7% | $17 Bil | $279 Bil |
| MSFT | $223 Bil | 8.1% | $105 Bil | $118 Bil |
| JPM | $176 Bil | 20.8% | $71 Bil | $105 Bil |
| META | $159 Bil | 10.0% | $10 Bil | $149 Bil |
| XOM | $152 Bil | 23.5% | $79 Bil | $73 Bil |
| BAC | $125 Bil | 32.2% | $45 Bil | $80 Bil |
| CVX | $112 Bil | 29.8% | $57 Bil | $55 Bil |
| WFC | $105 Bil | 39.3% | $22 Bil | $83 Bil |
| NVDA | $96 Bil | 2.1% | $3.0 Bil | $93 Bil |
For full ranking, visit Buybacks & Dividends Ranking
What do you notice here? The total capital returned to shareholders as a % of the current market cap appears inversely proportional to growth prospects for reinvestments. Stocks like Meta (META) and Microsoft (MSFT) are growing much faster, in a more predictable way, compared to the others, but they have returned a much lower fraction of their market cap to shareholders.
That’s the flip side to high capital returns. Sure, they are attractive, but you have to ask yourself the question: Am I sacrificing growth and sound fundamentals? With that in mind, let’s look at some numbers for MCD. (see Buy or Sell McDonald’s Stock for more details)
McDonald’s Fundamentals
- Revenue Growth: 3.7% LTM and 5.1% last 3-year average.
- Cash Generation: Nearly 26.7% free cash flow margin and 46.1% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in the last 3 years for MCD was 1.7%.
- Valuation: McDonald’s stock trades at a P/E multiple of 25.4
| MCD | S&P Median | |
|---|---|---|
| Sector | Consumer Discretionary | – |
| Industry | Restaurants | – |
| PE Ratio | 25.4 | 24.1 |
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| LTM* Revenue Growth | 3.7% | 6.8% |
| 3Y Average Annual Revenue Growth | 5.1% | 5.5% |
| Min Annual Revenue Growth Last 3Y | 1.7% | 0.4% |
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| LTM* Operating Margin | 46.1% | 18.6% |
| 3Y Average Operating Margin | 46.0% | 18.1% |
| LTM* Free Cash Flow Margin | 26.7% | 14.2% |
*LTM: Last Twelve Months
The table gives a good overview of what you get from MCD stock, but what about the risk?
MCD Historical Risk
McDonald’s isn’t immune to big sell-offs. It fell about 47% during the Dot-Com Bubble and nearly 37% in the Covid crash. The Global Financial Crisis hit it for around 21%, and even smaller pullbacks like the 2018 correction and the recent inflation shock knocked it down between 16% and 17%. Solid fundamentals matter, but when things get rough, even steady stocks like MCD can take a sizable hit.
But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, and outlook changes. Read MCD Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
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