BUZZ-Citigroup upgrades McDonald's and Sweetgreen, downgrades Yum Brands

Reuters
2025/01/10
BUZZ-Citigroup upgrades McDonald's and Sweetgreen, downgrades Yum Brands

** Brokerage Citigroup upgrades rating on McDonald's MCD.N and salad chain Sweetgreen SG.N to "buy" from "neutral"

** MCD's strategy of providing menu with flexible starting price and stronger advertising capabilities compared to peers to benefit co in 2025 - brokerage

** SG's consistency of output, speed and accuracy of pick-up items to eventually outweigh on-demand customization options offered at many fast casual competitors and concerns about automation driving job losses - brokerage

** Citigroup downgrades KFC-owner Yum Brands YUM.N to "neutral" from "buy", cuts PT to $141 from $153

** Expects difficult international operating environment to persist in 2025 due to lingering risks of global unit closures and ongoing macro challenges in China

** Slowing wage growth in U.S. may also hit YUM's customer visits - brokerage

** Shares of MCD up marginally and SG up ~2% in premarket trading, YUM dips about 1%

** SG rose nearly 184% and YUM ~3% last year, while MCD fell about 2%

(Reporting by Anuja Bharat Mistry in Bengaluru)

((AnujaBharat.Mistry@thomsonreuters.com;))

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