FINANCIAL VALUATION OF MCDONALD’S CORP NYSE: MCD

ABSTRACT

CATERPILLAR, ONE OF THE WORLD'S MOST RECOGNISED INDUSTRIAL BRANDS, IS A LEADING GLOBAL MANUFACTURER OF CONSTRUCTION AND MINING EQUIPMENT, AS WELL AS DIESEL AND NATURAL GAS ENGINES AND INDUSTRIAL GAS TURBINES. CURRENTLY, CATERPILLAR OPERATES IN NORTH AMERICA, ASIA PACIFIC, EAME REGION AND LATIN AMERICA, WITH OPERATIONS IN NORTH AMERICA ACCOUNTING FOR APPROXIMATELY 47% OF THE COMPANY'S NET REVENUE IN 2022. CATERPILLAR HAS BEEN ABLE TO WIN CUSTOMERS' TRUST AND ACHIEVE STABLE BUSINESS GROWTH THROUGH RELIABLE PRODUCTS, ADVANCED TECHNOLOGY, USER-FRIENDLY SERVICES AND DIFFERENTIATED SERVICE SOLUTIONS. POST-CORONAVIRUS, IT CAN BE SEEN THAT THE INDUSTRY IN WHICH CATERPILLAR OPERATES IS VULNERABLE TO CHANGES IN THE ECONOMIC AND SOCIAL ENVIRONMENT. IN ADDITION, THE INDUSTRY IS BECOMING INCREASINGLY COMPETITIVE, ESPECIALLY WITH THE RISE OF EMERGING PLAYERS, SUCH AS CONSTRUCTION EQUIPMENT MANUFACTURERS IN CHINA, WHO ARE ENTERING THE MARKETS OF DEVELOPING COUNTRIES WITH COST-EFFECTIVE PRODUCTS. IN ADDITION TO THAT, SUCH AS THE TRADITIONAL MACHINERY MANUFACTURING COMPANIES IN EUROPE AND JAPAN, THEIR PRODUCTS ARE NOT ONLY HIGHLY INTELLIGENT, BUT ALSO MOTORISED EQUIPMENT TECHNOLOGY IS QUITE RELIABLE. IT IS A TOUGH CHALLENGE TO MAINTAIN A COMPETITIVE EDGE. UNDERSTANDING THE IMPACT OF THESE CHANGES ON THE INDUSTRY AND THE COMPANY HELPS IN ASSESSING THE INTRINSIC VALUE OF CATERPILLAR AND ITS FUTURE POSITIONING. COMPARING THE INTRINSIC VALUE DERIVED FROM THE THREE VALUATION MODELS TO THE COMPANY'S MARKET SHARE PRICE AS OF 31 DECEMBER 2022 WILL PROVIDE VALUABLE INFORMATION TO INVESTORS.