CMG vs MCD

For growth investors, Chipotle Mexican Grill, Inc.

(CMG) is the stronger pick with 5. 4% revenue growth year-over-year, versus 1. 7% for McDonald's Corporation (MCD). McDonald's Corporation (MCD) offers the better valuation at 24. 9x trailing P/E (21. 5x forward), making it the more compelling value choice. Analysts rate Chipotle Mexican Grill, Inc. (CMG) a "Buy" — based on 67 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, McDonald's Corporation (MCD) is the cheapest at 24.

9x versus Chipotle Mexican Grill, Inc. at 28. 7x. On forward P/E, McDonald's Corporation is actually cheaper at 21. 5x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Chipotle Mexican Grill, Inc. wins at 0. 81x versus McDonald's Corporation's 2. 82x — a PEG below 1. 0 traditionally signals the market is underpricing earnings growth.

Over the past 5 years, McDonald's Corporation (MCD) delivered a total return of +34.

4%, compared to +15. 9% for Chipotle Mexican Grill, Inc. (CMG). Over 10 years, the gap is even starker: CMG returned +276. 8% versus MCD's +158. 5%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), McDonald's Corporation (MCD) is the lower-risk stock at 0.

11β versus Chipotle Mexican Grill, Inc. 's 1. 11β — meaning CMG is approximately 900% more volatile than MCD relative to the S&P 500.

By revenue growth (latest reported year), Chipotle Mexican Grill, Inc.

(CMG) is pulling ahead at 5. 4% versus 1. 7% for McDonald's Corporation (MCD). On earnings-per-share growth, the picture is similar: Chipotle Mexican Grill, Inc. grew EPS 2. 7% year-over-year, compared to -1. 5% for McDonald's Corporation. Over a 3-year CAGR, CMG leads at 11. 4% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

McDonald's Corporation (MCD) is the more profitable company, earning 31.

7% net margin versus 12. 9% for Chipotle Mexican Grill, Inc. — meaning it keeps 31. 7% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: MCD leads at 45. 2% versus 16. 9% for CMG. At the gross margin level — before operating expenses — MCD leads at 56. 8%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, Chipotle Mexican Grill, Inc. (CMG) is the more undervalued stock at a PEG of 0. 81x versus McDonald's Corporation's 2. 82x. A PEG below 1. 0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, McDonald's Corporation (MCD) trades at 21. 5x forward P/E versus 28. 8x for Chipotle Mexican Grill, Inc. — 7. 2x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for CMG: 33. 7% to $43. 72.

In this comparison, MCD (2.

4% yield) pays a dividend. CMG does not pay a meaningful dividend and should not be held primarily for income.

For long-horizon retirement investors, McDonald's Corporation (MCD) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.

11), 2. 4% yield, +158. 5% 10Y return). Both have compounded well over 10 years (MCD: +158. 5%, CMG: +276. 8%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Consumer Cyclical sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

MCD pays a dividend while CMG does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.