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If I were an investor in McDonalds, I would certainly wonder why the profit lowered. Headline billion-dollar profits sound impressive, but are meaningless unti
by brc 13y ago
If I were an investor in McDonalds, I would certainly wonder why the profit lowered.
Headline billion-dollar profits sound impressive, but are meaningless until you see how much capital has been employed. It's all very well to say they should halve their profit, but if that then meant that the returns for the company fell below what is expected from the sector, there will be other flow-on effects, such as a falling company value, difficulty in raising further capital if required, and other problems.
I would turn the question around - what's wrong with a $11b profit? The duty of the McDonalds management is to increase returns for the shareholders, not to run a make-work business.
- georgemcbay 13y ago> I would turn the question around - what's wrong with a $11b profit? Nothing, by itself, but in the case of McDonalds, Walmart and others who make massive use of minimum wage workers that profit is heavily subsidized by all of us as taxpayers since by holding on to that money and not sharing it with the employees we (taxpayers) now need to help fill the gap created between the cost of living and what those corporations are paying the majority of their workers.