I've been looking into McDonald's after its recent decline and wanted to get opinions from people who follow the company more closely.

From what I can tell:

It's down roughly 25% from its recent highs.

P/E is around 21, which seems more reasonable than before.

Dividend yield is close to 3%.

The business still has one of the strongest franchise models in the world.

What I'm trying to understand is why the market has become so bearish still after it dropped 25%

main issue is its current menu prices are too high for people's expectations....then just bring the price down! they make huge margins at MCD anyways. I like those 5$ value meals, it's recession proof and still profitable cuz the drinks

MCD is cheap per calorie with access to wifi, washroom, parking, which is all important in a recession. people would rather eat junk food than starve. poor people don't have money/time for healthy food

average young person is too broke for healthy food as the middle class is shrinking. average young person does not care as much about their health because they are pessimistic of owning properties and retirement and focus more on investing in experiences such as travelling or giving up on the system laying flat living at their parents

I still think McDonald's is considered an essential convenience purchase for a lot of people. Not everyone has the time or ability to cook lunch, whether they're working on the road, at a job site, or they're simply too lazy or tired to cook.

The increase in single people decreases cooking probability, which will also increase sales in fast food.

The sales of Ozempic means you eat less but you can still eat at fast food. Ozempic only reduces food quantity so it's not going to kill the business...most importantly it's still expensive for the lower middle class who cannot afford it

McDonald's still has some of the cheapest fast-food items in North America with the App

Everything has gone up, it's not just MCD menu

the CEO bite meme is old news.

meanwhile Starbucks trades at 80PE wtf lol

[the original post was getting me unwanted attention, so I removed it]

Thoughts?

Like a lot of people, i've mostly stopped clicking through Google results. i read the AI answer and move on. by the old logic that should be killing their ads business.

then this quarter printed: queries at an all-time high, AI Mode past 1B monthly users, search revenue still up 17% to $63B. revenue beat, cloud grew 82%. and the stock sold off anyway, because the capex guide went up again ($195-205B for the year) and free cash flow went negative for the quarter.

trying to square that, here's where i landed: people like me were never the revenue. i read results and don't click ads. in the old world google made nothing off me, in the AI world it still makes nothing off me. the clicks the AI answers "stole" were mostly free riders. commercial-intent searches, flights, insurance, shopping, those still click, and that's where the money always was. so freeloaders going clickless costs less than it sounds, while the queries that do monetize keep growing.

second thing i keep chewing on: if the future is GEO instead of SEO, everyone optimizing to get recommended by google's AI instead of ranked by its index, the entry point stays google's. same gatekeeper, new door.

and the race framing matters. for OpenAI and Anthropic, winning is existential, they fund the war with fundraising rounds. google funds it with $63B a quarter of ad money. it's the only runner in the race that can afford to lose it.

what i can't settle is the price. north of $4T with negative FCF and a capex guide that keeps climbing is a lot to pay for "they survived the scariest question." two things i'd genuinely like input on: has anyone done a proper sum-of-parts at these levels? and is there any data on what share of google clicks were ever monetizable, or is my freeloader theory just me projecting my own habits?

(Note: I bought CMG roughly 10 years because of food poisoning. I sold after the ceo left for Starbucks 2 years ago. Now I am watching this sector closely. This is a long tooth gift horse. Buy with a plan!)

DOW JONES NEWSWIRES
FDA Reports a New Cyclospora Outbreak -- 2nd Update
July 22, 2026

By Josh Beckerman

The Food and Drug Administration is looking into a new outbreak of cyclospora linked to a not yet identified product and has initiated traceback.

The new outbreak includes 72 cases.

Government agencies have linked lettuce, including products at Taco Bell locations, to thousands of reports of foodborne illness in the U.S. The FDA reported a false positive test for a sample of Taylor Farms iceberg lettuce, but said there was "overwhelming epidemiological data" supporting a Taylor Farms voluntary recall.

Meanwhile, for another outbreak of cyclospora, the case count has increased from eight to 10, the FDA said Wednesday.

The Centers for Disease Control and Prevention said that since May 1, it has received reports of 4,173 laboratory-confirmed domestic cases of cyclosporiasis and was aware of more than 7,400 additional cases that require further investigation and analysis.

Shares of Taco Bell owner Yum Brands, Cava Group, Chipotle Mexican Grill and Sweetgreen moved lower in the afternoon following the FDA's announcement of a new cyclospora outbreak.

Yum Brands ended the day up 0.3% to $147.57 while Sweetgreen was down 7% to $6.30.

In a Tuesday note about the upcoming earnings report from Sprouts Farmers Market, Oppenheimer said the retailer could face "potential headwinds in the produce category related to consumer fears" about cyclospora.

Write to Josh Beckerman at [email protected]

Im not trying to bring politics into this, but lets just say that i think the next US administration will be a democrat and I think politically that offers an opportunity in renewable energy and moreso in things like solar...im big on a nuclear future long term, but medium to long term i think solar will be big too. I was looking at thr Charles Schwab investing themes for renewable energy and First Solat (FSLR) caught my eye.

​1. Company Fundamentals & Moat: Holds a narrow-to-wide moat driven by proprietary thin-film CadTel technology, vertical integration, and a contracted sales backlog extending out multiple years. Its primary competitive edge over Chinese crystalline silicon competitors is protection from domestic trade tariffs and non-China supply chain independence. I think these are likely to remain in some form for the foreseeable future regardless of us administration

​2. Financial Health & Capital Allocation: Extremely healthy balance sheet with ROE around 26% and ROIC around 17%. Holds ~$2.4B in gross cash against only ~$468M–$587M in debt (net cash position ~$1.9B+). Free cash flow is heavily reinvested in U.S. factory expansion rather than dividend payouts

​3. Accounting Quality & Red Flags: Strong operating cash flow (~$2.45B TTM) generally matches net income trends, but the key driver of accounting profit is reliant on policy—specifically Section 45X advanced manufacturing tax credits from the IRA (projected at $2.1B–$2.19B for 2026

4.Valuation & Market Expectations: Trades at a reasonable valuation (~13x–14.5x trailing/forward P/E). A reverse DCF implies low-single-digit underlying terminal growth rates, making current market expectations fairly conservative relative to its multi-year revenue visibility.

1. Management & Governance: Management consistently executes on capacity targets (scaling toward 25 GW globally) and maintains disciplined leverage, though short-term guidance changes during energy policy shifts remain a key variable to monitor.

6.Macro Factors & Risks: Major tailwinds include utility-scale solar buildouts and AI data-center energy demand. Primary risk is political/policy exposure—changes to tariff rules or domestic manufacturing tax credit phase-outs represent existential long-term margin risks.

I admit that a lot of this started because im pretty confident that the USA will have a democratic administration next, and I think renewable energy is inevitable, but i look at the numbers and they already look like a solid company and will benefit from these trends...especially looking at the P/E right now

Im still trying to refine my thinking, so im open to any feedback or criticism, but i do honestly believe its a solid value play right now and will benefit in the future.

Before we get into it: Please focus on discussing risk management & positioning in regards to the luring burst of the AI bubble and refrain from arguing that there is no bubble - in the interest of this subs actual purpose.

Certainly nobody knows when the AI bubble will burst, yet it is quite obvious that it has to - probably sooner than later. The market is burning hot, the Buffet Indicator is through the roof and valuations aren´t just stretched anymore: They are batshit crazy and often just psychotic. We see so many symptoms of the final phase of any bubble, for example the insane amount of IPOs launched, and of course the pinnacle of market insanity as in SpaceX and comparable cash-burning, high-risk, zero-gain type of promises. You might still think: "Everything is going great!" Yeah - until it isn´t.

Taking into consideration the exuberance and the market´s recent detachment from reality, the question is: How to prepare for the inevitable? I am not so much asking about speculation regarding the actual price decline in % - a correction could be a meagre -20%, but also a solid -80% depending on your personal portfolio and allocation.

The S&P500 is off the table: Barely any diversification anymore, insanely tech heavy - basically a bubble-ETF at this point.

World Index Funds: Fair, but again with a rather long timeline.

As far as resources go: Gold and silver still highly overvalued, with no tangible value attached to it in the sense of: Gold and silver generate no cashflow or profit.

Personally I am not well educated about oil, so as it goes with value-investing: Don´t buy what you don´t understand fully.

Anyway: What do you folks do to protect yourself from the threatening correction? What is your strategy? How do you structure your portfolios and what buckets do you have?

Looking forward to exchange ideas here.

---

Notabene: For me, I am holding on to almost none of my older positions now except from notable SaaS companies. Europe-based, of course, given that I´d rather trade some odd 2% of gains for stability and detachment from the USD. Not just because of the Orange Man doing his thing, but mainly because of the insane pressure resting on the USD and US stocks being generally overvalued as hell. Add the demographic shift and the risk of tons of people liquidating in the next 5 odd years. We are just talking retail investors here, not institutional investors. Expect those to also sell eventually - and as it goes, we just cannot be as fast as insiders. About the SaaS still: I am into companies providing governmental structures with software solutions. Tax offices and other administrative departments won´t just transfer from a well-working infrastructure to something else that poses security risks. Or even might cause severe data processing delays while millions of people simply have to do their taxes. AI will not replace this - at best, AI will be implemented to streamline already existing infrastructure.

Looking forward to your replies. What are your "safe havens"? What sectors are you researching and why?

(As usual: No financial advice, just personal opinion)

It’s been beat down to $62, people may be eating less of it when saving money but I still see it has a cult following ? I’m leaning a bit more into bros at these prices just because coffee is cheaper for a consumer.. what do yall think at these prices

Why does the SK Hynix ADR (P/E 23.1) trade at a 33% premium over its local shares, 000660.KS (P/E 17.3)?

Does this mean anyone in the US buying SK Hynix stock is paying a 33% premium just to hold the same shares?

How long can this premium last?

I hung in tight after buying Kenvue stocks based on Scott Galloway tip.
I wonder when I might be able to let it go.
I only bought 50 shares (ugh at 20.88).
Thanks!

You've prob seen SOTP discounts before, but this one is absurd.

At €75/share, €38Bn MktCap. Volkswagen (VOW.DE, or $VWAGY) trades at a 62% discount to a conservative SOTP (€100Bn)

Volkswagen's stake in Porsche (75%) and TRATON (87.5%); both are publicly listed, worth ~€45Bn ~= 1.2x VW's worth.

You get paid to own VW, Audi, Bentley, Lambo, Financial arm, minority equity stakes in QuantumScape Gotion, XPeng, 2 football clubs, etc. You also get paid ~7% div yield to wait for re-rating, with two independent paths:

1. Earnings recovery:

2025 op profit fell 55% YoY, but the majority of the decline traces to one-off items, tariffs, Porsche restructuring charge, and a truck downturn. A return to 2024-normal earnings would value VW at 2x today's EV/EBIT.

2. Asset unlocks:

• Lambo, the 3rd largest luxury automaker (behind Porsche and Ferrari), is estimated to be worth ~€20Bn if it IPOs.
• TRATON, VW's commercial truck biz, with 87.5% stake, targets to reduce to 75%.

Building the bull case is not hard; the hard part is to underwrite the bears: China Crisis, Governance, EV missteps, name a few.

China: JV profit down from a €5.2bn peak to under €1bn, part of a broader foreign-OEM retreat (64% → 31% share since 2020). But China's now only ~10% of group profit and ~5% of modeled SOTP value. Even if it goes to zero, the core thesis barely moves

Governance: a circular ownership structure, a debt-laden family holding company, a labor-controlled supervisory board, and a state government with effective veto rights: a cap table built to resist today's value-unlock. Yet, the June 2026 Everllence sale and a July 2026 board meeting are the first real signs of movement in years.

The list is long, and honestly, every contrarian pick has a long list of "potentially devastating news". The real question is "how bad, and how likely these could occur, and what's the odds-adjusted downside?"

The entire writeup is here https://underhood.substack.com/p/the-peoples-car-priced-like-scrap; a good portion, including SOTP Valuation, 2025 vs 2024 analysis, is before the paywall for those interested.

It's common knowledge in value investing circles that volatility isn't risk. While I think this is true when viewing risk from a comprehensive perspective, many falsely believe this means you can ignore volatility entirely. The truth is, there is a known and tangible drag on portfolio performance known as the volatility tax.

Volatility tax is, formally, the difference between the arithmetic and geometric mean of returns. It is also roughly estimated by subtracting variance over 2 from the arithmetic mean. In any case, the more volatile the asset is, the lower the geometric mean is compared to the arithmetic mean.

Why does this matter? Because compound returns are based on the geometric mean of returns, not the arithmetic mean. Here's a simple example. Assume you have an asset that loses 50% of its value in one year, and then gains 100% the next. Its 'average' return is 25% per year, even though you ended up right where you started. The volatility tax, then, is 25%.

Geometric mean = (0.5 x 2)^(1/2) = 1. No return.
Arithmetic mean = (0.5 + 2) / 2 = 1.25. "25%" return.

Let me be clear: this is important because the arithmetic mean is usually what people mean when saying "expected returns". The intelligent investor must understand that volatility eats into compound returns, the REAL returns you expect to make from a portfolio. Therefore, one shouldn't ignore volatility entirely; even if it isn't risk per se, it IS a cost one should keep in mind when making investment decisions.

As a side note, having a low cost basis helps you not worry about volatility eating into your principal investments, but volatility still detracts from future returns. Cheers!

Normally, I write a long post explaining my point of view. I'm new to Reddit and want to do the opposite and not bias anyone. This is my first post in r/ValueInvesting.

Here are a few facts:

• Reddit crushes the rule of 40 score.
• Revenues grew 70% y/y in Q1 2026
• 38% Adj EBITDA margin in 2025
• ADJ EBITDA grew 130% y/y in Q1 2026
• There's essentially no capex and OCF was >$300MM in Q1
• $1.2Bn in expected FCF for 2026
• That's a 4% FCF yield based on the current market cap
• $2.8Bn in cash, against $0 debt

And the concerns

• North American DAU has slowed to about flat
• AI (will it be good or bad)

Value investing doesn't mean low P/E, low P/B... if you are Charlie Munger/Henry Singleton you buy great businesses at fair prices. Is that where we are? If not, how far above or below are we?

Went all in before earnings and now I’m down big. Is it a good buy?