# McDonald’s Corporation (MCD)

McDonald's Corporation is an American fast food company, founded in 1940 as a restaurant operated by Richard and Maurice McDonald, in San Bernardino, California, United States. They rechristened their business as a hamburger stand, and later turned the company into a franchise, with the Golden Arches logo being introduced in 1953 at a location in Phoenix, Arizona.

## Stock Price Trends

Stock price trends estimated using linear regression.

#### Key facts

- The primary trend is decreasing.
- The decline rate of the primary trend is 53.26% per annum.
- MCD price at the close of April 16, 2024 was $265.43 and was inside the primary price channel.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 63.30% per annum.
- MCD price at the close of April 16, 2024 was inside the secondary price channel.

### Linear Regression Model

Model equation:

Y_{i} = α + β × X_{i} + ε_{i}

Top border of price channel:

Exp(Y_{i}) = Exp(a + b × X_{i} + 2 × s)

Bottom border of price channel:

Exp(Y_{i}) = Exp(a + b × X_{i} – 2 × s)

where:

i - observation number

Y_{i} - natural logarithm of MCD price

X_{i} - time index, 1 day interval

σ - standard deviation of ε_{i}

a - estimator of α

b - estimator of β

s - estimator of σ

Exp() - calculates the exponent of e

### Primary Trend

Start date: February 22, 2024

End date: April 16, 2024

a = 9.3906

b = -0.0021

s = 0.0120

Annual growth rate:

Exp(365 × b) – 1

= Exp(365 × -0.0021) – 1

= -53.26%

Price channel spread:

Exp(4 × s) – 1

= Exp(4 × 0.0120) – 1

= 4.92%

#### February 22, 2024 calculations

Top border of price channel:

Exp(Y_{1,220})

= Exp(a + b × X_{1,220} + 2 × s)

= Exp(a + b × 1,772 + 2 × s)

= Exp(9.3906 + -0.0021 × 1,772 + 2 × 0.0120)

= Exp(5.7218)

= $305.46

Bottom border of price channel:

Exp(Y_{1,220})

= Exp(a + b × X_{1,220} – 2 × s)

= Exp(a + b × 1,772 – 2 × s)

= Exp(9.3906 + -0.0021 × 1,772 – 2 × 0.0120)

= Exp(5.6738)

= $291.14

#### April 16, 2024 calculations

Top border of price channel:

Exp(Y_{1,257})

= Exp(a + b × X_{1,257} + 2 × s)

= Exp(a + b × 1,826 + 2 × s)

= Exp(9.3906 + -0.0021 × 1,826 + 2 × 0.0120)

= Exp(5.6093)

= $272.95

Bottom border of price channel:

Exp(Y_{1,257})

= Exp(a + b × X_{1,257} – 2 × s)

= Exp(a + b × 1,826 – 2 × s)

= Exp(9.3906 + -0.0021 × 1,826 – 2 × 0.0120)

= Exp(5.5613)

= $260.16

#### Description

- The primary trend is decreasing.
- The decline rate of the primary trend is 53.26% per annum.
- MCD price at the close of April 16, 2024 was $265.43 and was inside the primary price channel.

### Secondary Trend

Start date: March 20, 2024

End date: April 16, 2024

a = 10.5929

b = -0.0027

s = 0.0094

Annual growth rate:

Exp(365 × b) – 1

= Exp(365 × -0.0027) – 1

= -63.30%

Price channel spread:

Exp(4 × s) – 1

= Exp(4 × 0.0094) – 1

= 3.84%

#### March 20, 2024 calculations

Top border of price channel:

Exp(Y_{1,239})

= Exp(a + b × X_{1,239} + 2 × s)

= Exp(a + b × 1,799 + 2 × s)

= Exp(10.5929 + -0.0027 × 1,799 + 2 × 0.0094)

= Exp(5.6707)

= $290.22

Bottom border of price channel:

Exp(Y_{1,239})

= Exp(a + b × X_{1,239} – 2 × s)

= Exp(a + b × 1,799 – 2 × s)

= Exp(10.5929 + -0.0027 × 1,799 – 2 × 0.0094)

= Exp(5.6329)

= $279.48

#### April 16, 2024 calculations

Top border of price channel:

Exp(Y_{1,257})

= Exp(a + b × X_{1,257} + 2 × s)

= Exp(a + b × 1,826 + 2 × s)

= Exp(10.5929 + -0.0027 × 1,826 + 2 × 0.0094)

= Exp(5.5965)

= $269.48

Bottom border of price channel:

Exp(Y_{1,257})

= Exp(a + b × X_{1,257} – 2 × s)

= Exp(a + b × 1,826 – 2 × s)

= Exp(10.5929 + -0.0027 × 1,826 – 2 × 0.0094)

= Exp(5.5588)

= $259.50

#### Description

- The secondary trend is decreasing.
- The decline rate of the secondary trend is 63.30% per annum.
- MCD price at the close of April 16, 2024 was inside the secondary price channel.