Inflation Odds Move Toward 100%

Impact · against what's priced in

The surge in diesel and beef prices creates immediate headwinds for retail and fast-food margins, though the market has already priced these names as defensive, low-growth entities. The primary risk is that rising cost pressures make the aggressive revenue CAGRs required to justify current valuations even more unattainable.

MCD−0.30

Challenges what's priced in

The price assumes

Maintenance of current 26.7% FCF margin alongside expansion

Record high diesel prices ($5.85, up 58% YoY) increase freight costs for deliveries, directly threatening the free-cash-flow margin the market treats as a durable floor.

What MCD's price assumes · Aug 27

• fed▲133%
• inflation▲18%
• MCD
• WMT
• consumer sentiment
• cost of living
• cpi
• diesel