1 Stock to Buy, 1 Stock to Sell This Week: McDonald’s, PayPal
Wall Street concluded positively last week, buoyed by impressive quarterly outcomes from leading tech giants and a robust employment report, enhancing economic confidence. Both the Dow and the S&P 500 saw a 1.4% rise, while the Nasdaq Composite grew by 1.1%, marking their fourth consecutive week of gains. The upcoming week, packed with economic data and Federal Reserve speakers, promises to keep market watchers busy.
Amid this backdrop, let’s zero in on two stocks that could shape your trading week: McDonald’s for a potential buy, and PayPal for a possible sell.
McDonald’s: A Recipe for Success
McDonald’s, set to release its fourth-quarter earnings on Monday, is anticipated to reveal strong results supported by favorable consumer trends. Analysts predict a 9.3% increase in EPS and an 8.8% rise in revenue year-over-year, attributing success to strategic pricing, promotional efforts, and a thriving digital loyalty program. With an expected jump in U.S. same-store sales and positive guidance for the coming quarter, McDonald’s seems well-equipped to navigate the uncertain economic landscape. Currently sitting just below its record high, McDonald’s stock portrays a promising buy this week.
PayPal: Navigating Rough Waters
On the flip side, PayPal faces a challenging week ahead as it prepares to report its fourth-quarter earnings. A slowing e-commerce sector and fierce competition have led to downward adjustments in profit forecasts, despite a planned workforce reduction aiming to curb expenses. With projected modest year-over-year growth in earnings and revenue, the outlook remains cautious. PayPal’s stock has significantly underperformed in the past year, casting shadows on its immediate growth prospects and positioning it as a potential sell this week.
