1 Reason to Buy and Hold This Dividend Stock for the Next 10 Years
It just graduated to Dividend King.
McDonald's has reached a significant milestone this year by becoming a Dividend King, having increased its dividend for an impressive 50 consecutive years in 2026. This consistency in dividend raises is one major reason to consider investing in McDonald's for the next decade. In September, the company raised its quarterly dividend to $1.93 per share, marking a 4% increase from the previous quarter and solidifying their 50-year streak of dividend growth.
Ian Borden, McDonald's global CFO, attributes this milestone to the company's financial discipline, shareholder rewards, and ongoing commitment to growing the dividend. Despite recent struggles with inflation and higher costs impacting sales, McDonald's reported solid second-quarter results, with revenue up 4%, systemwide sales up 5%, and earnings up 6%.
The company's new strategic plan, NEXT, focuses on elevating the menu, leveraging brand strength, improving operational efficiency through AI and new restaurant designs, and investing in people to enhance customer experience. McDonald's has allocated $8.5 billion between now and 2036 to modernize its restaurants and upgrade technology, aiming for a 50% operating margin by 2030 and an 80% range of free cash flow conversion rate by then.
With the stock trading at a 52-week low and a low forward P/E ratio, McDonald's appears well-positioned to support its dividend for years to come, potentially hitting a 60-year streak of dividend raises in the next decade.
Written by urgent.news from Motley Fool's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
