“Slow Growth in 2025,” Says Analyst on Downgrading McDonald’s (MCD) Stock to Hold

McDonald’s (MCD) has recently received a rating downgrade from Erste Group to Hold from Buy. At the same time, the fast-food giant is making some big changes to its business. The company is closing all standalone CosMc’s locations, its beverage-focused brand, but plans to add some of its drinks to the regular menu.

Why the Downgrade?

Despite McDonald’s strong and stable profit margins, much higher than its rivals, Erste Group expects slow sales growth in 2025. The firm predicts a better growth rate in 2026, though limited momentum this year may cap stock price increases.

Also, Erste Group believes McDonald’s stock’s P/E ratio is slightly above the sector average, which could restrict further upside in the near term.

CosMc’s Experiment Ends

McDonald’s launched CosMc’s in 2023 as a small-format beverage concept, aiming to compete with Starbucks (SBUX) and Dunkin’ by offering specialty drinks like frappes, cold brews, and energy slushes.

The concept was tested in five locations across Illinois and Texas, but McDonald’s recently decided to shut down all standalone CosMc’s stores by June 2025.

It must be noted that MCD is not abandoning the idea entirely. Some drinks will be rolled out at McDonald’s restaurants across the U.S. to test demand on a larger scale.

Is McDonald’s a Buy, Sell, or Hold Stock?

Turning to Wall Street, MCD stock has a Moderate Buy consensus rating based on 14 Buys and 10 Holds assigned in the last three months. At $334.74, the average McDonald’s stock price target implies a 6.41% upside potential.

See more MCD analyst ratings