McDonald’s Investors May Want to Catch the Stock Ahead of Pokémon Partnership

McDonald’s Corporation MCD reports third-quarter financial results Wednesday before market open.

While the restaurant company could show signs of growth and reasons why shares are enjoying a one-month 12% rally, the big catalyst could be coming in a week.

• McDonald’s stock is under selling pressure. Why are MCD shares declining?

McDonald’s Q3 Earnings Estimates

Analysts expect McDonald’s to report third-quarter revenue of $7.28 billion, up from $7.08 billion in last year’s third quarter, according to data from Benzinga Pro.

The company has beaten analyst estimates for revenue in five of the past 10 quarters, but missed estimates in the most recently reported second quarter.

Analysts expect McDonald’s to report third-quarter earnings per share of $3.38, up from $3.22 last year.

The company has beaten analyst estimates for earnings per share in seven of the last 10 quarters, including three straight quarters.

McDonald’s Upcoming Catalyst

For decades, McDonald’s has offered Happy Meals and toys for its younger customers.

Sometimes these toys center on an upcoming movie or television show and other times they are part of a partnership with a long-running brand.

Starting on Nov. 10 in the U.S., McDonald’s will launch its latest collaboration with The Pokémon Company, which is partially owned by Nintendo Co NTDOY.

The latest partnership includes the launch of three different Happy Meal designs, 15 Pokémon trading cards and 15 Pokémon keychains that resemble Happy Meal boxes.

This marks the first time McDonald’s has had physical Happy Meal toys since 2018. The company has launched cards in recent years in Happy Meals, often seeing a bump in traffic.

McDonald’s will roll out different characters each week for the toys, which could provide a string of steady traffic throughout the Nov. 10 through Dec. 14 promotion as kids and collectors look to "catch ‘em all."

The toys and card set are part of the 30th anniversary celebration of the Pokémon brand.

Anyone who has followed Pokémon and the trading card releases knows demand is incredibly high for the brand right now. Consumers and collectors are turning release day into madhouses at retailers, with lines out the door of people waiting for the latest product delivery.

The Happy Meal promotion will also launch in other countries on Nov. 10, followed by more international releases in December.

With worldwide brand awareness and love for Pokémon, this could be one of the most anticipated Happy Meal toys in years.

For McDonald’s, this could mean increased traffic, order size and repeat customers for the busy holiday season.

While the company reports third-quarter results Wednesday, the fourth quarter could be the one for investors to watch.

McDonald’s Stock Price Action

McDonald’s stock is down 1.2% to $262.49 on Tuesday versus a 52-week trading range of $229.20 to $341.75. Shares are up 12.6% over the last month, which came after shares hit four-year lows. The stock is down around 23% from all-time highs set in February of this year.