McDonald's sues meat giants for price manipulation

9 Eki

McDonald's - NYSE: MCD, has sued major meat companies, including JBS - BVMF: JBSS3,), Tyson Foods - NYSE: TSN, Cargill - (private, not publicly traded) and National Beef - (private, not publicly traded) accusing them of manipulating meat prices since 2015. According to the lawsuit, these companies would have intentionally reduced the supply of cattle to increase prices, which has affected McDonald's, raising the cost of its hamburgers. The fast food chain is not only seeking compensation for cost overruns, but is also asking the courts to put an end to these anti-competitive practices.
This type of accusations has already appeared in the past for these companies, facing lawsuits from producers and consumers. The outcome of this case could significantly influence meat markets and the food industry in general.

Highlights:
• McDonald's alleges price manipulation. It could affect the Q3 results presentation (10/29/24) which could send the company's shares to new highs. In any case DCM estimates for this third quarter seem to be higher than the previous quarter. Always the holiday period usually results in better results for restaurant companies.
• Companies involved: they are giants of the U.S. meat sector.
• Potential effects on meat markets. If the trial goes in favor of McDonald's, this could improve its balance sheet.

Technical aspect of McDonald's:
In recent weeks it has been recovering its price to the high zone since the last Q2 earnings release, higher than the Q1 quarter. The RSI indicator at 63.89% slightly oversold and using the Larry Williams indicator we see that the uptrend could continue for a while as it is still in the area of 122 points.

Ion Jauregui - Analyst ActivTrades





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