McDonald's and Domino's Pizza to Open Near 52-Week Highs

Restaurant chain operators McDonald's (NYSE: MCD) and Domino's Pizza (NYSE: DPZ) reached new multiyear highs of $98.43 and $35.00 per share, respectively, in Friday's trading session.

McDonald's has a target for 2012 of adding 1,300 new restaurants and remodeling of 2,400 existing restaurants. And the world's largest fast-food company reported stronger-than-expected sales for November. The company is headquartered in Oak Brook, Ill., and operates more than 32,000 restaurants in 117 countries. It was founded in 1940 and now has a market cap of $100.3 billion.

Earnings per share are anticipated to grow 10.5% over the next five years. The P/E ratio is lower than the industry average, the operating margin is much higher than the average, and the return on equity is a healthy 39.8%. Twenty out of 27 analysts recommend buying the stock. The share price is up more than 14% in the past 90 days and more than 30% higher than a year ago. Over the past six months, the stock has outperformed competitors Wendy's (NYSE: WEN) and Yum! Brands (NYSE: YUM).

Domino's Pizza CEO Patrick Doyle recently said his company was “recession resistant” and the stock was a Jim Cramer “stocking stuffer” pick. The company attributed strong results in the most recent quarter in part to international sales and digital sales. The pizza-delivery company has more than 9,300 stores. It is headquartered in Ann Arbor, Mich., has a market cap of $2.0 billion and was founded in 1960.

The P/E and PEG ratios are higher than the industry average but so is the operating margin. The long-term EPS growth forecast is 9.8%. Five out of 12 analysts recommend buying the stock; none of them consider it a sell. The share price is up almost 9% in the past month and is now more than 125% higher than a year ago. The stock has outperformed competitor Papa John's (NASDAQ: PZZA) and the broader markets over the past six months.