Rather than weighing on its bottom line, Europe may provide a boost to McDonald’s this summer, when the Olympics will be held in London, Keith Siegner, restaurant analyst at Credit Suisse, told CNBC Monday.
He said the consensus estimates for same-store sales in the U.S. and Europe are already up for the summer.
"The Olympics are in London, a massive, massive market for them, and I don’t really necessarily see a reason why (same-store sales) should slow in the summer," Siegner said.
"Actually, (Europe’s) been unbelievably resilient against what you’ve seen there this year," said Siegner, referring to the ongoing euro zone sovereign debtcrisis. McDonald's has "hardly any exposure in the periphery, and the major markets of Germany, U.K., France, and Russia have all been doing very, very well," he added.
Siegner said the biggest risk for the company in 2012 is foreign exchange, though he noted, "Look what the euro’s doing today."
Shares of the fast-food giant hit a 52-week high of $102.22 on Friday, before pulling back ahead of the release of its fourth-quarter earnings report prior to the opening bell Tuesday.
Siegner noted that McDonald's is closing in on his firm's $106 a share price target. The firm has an “outperform” rating on the stock, and he believe the stock has plenty of room to climb.
“If you think about last year, you have an really attractive combination of growth in fundamental earnings, plus a (foreign exchange) tailwind, plus multiple expansions,” Siegner said. “This year might be more focused on earnings per share growth than the other two, but I still think there’s a legitimate case for upside the numbers for fiscal 2012, and I think that that’s what people are going to be looking for tomorrow.”
When asked whether there's a better CEO in the sector than the company's chief, Jim Skinner, Siegner instead pointed to McDonald's overall business model and strategy as the key to the company's success.
“I think it’s a really broad-based, deep-bench, focus on the plan to win, not bigger just better. They’ve executed unbelievably well across all these regions and they’re in this positive feedback loop of secular share gains that begets more strength,” he said. “It’s hard to see what slows this train down.”
Additional News: McDonald's Extends Olympic Sponsorship to 2020
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Keith Siegner and his family do not own McDonald’s shares. Credit Suisse has managed or co-managed a public offering of securities for McDonald’s within the past 12 months. Credit Suisse also makes a market in the company’s securities.