Trade Burger King (BKW) for McDonald's (MCD)? Not So Fast... - Cramer
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Burger King Worldwide (NYSE: BKW) shares are trading lower Tuesday following a rather bearish call from stock selecting sensation Jim Cramer.
According to Cramer, the recent IPO of Burger King brings up a comparison issue: should investors jump ship from McDonald's (NYSE: MCD) for the fresher, newer Burger King stock? Sell Big Macs for Whoppers? Lose Chicken McNuggets for Chicken Tenders?
No. Cramer thinks that for the near-term player, Burger King might be fun as there are still a lot of catalysts to sort out. It just closed the business combination with Justice Holdings, leading to board shake-up and plenty of volatility.
Overall, investors might look at things like input costs and domestic economic data. Costs are still high or moving higher in several segments (wheat, corn) while jobs aren't coming back or being created as rapidly as expected. While McDonald's will be able to absorb most of those fluctuations, Burger King might have investors a little more nervous.
Along with its longevity, McDonald's also has a dividend with 3.1 percent yield. With McDonald's about 13 percent off highs hit in January, investors might do well to order up some shares. To go.
In Tuesday afternoon trading, McDonald's is up 0.8 percent while Burger King is down 2 percent.
According to Cramer, the recent IPO of Burger King brings up a comparison issue: should investors jump ship from McDonald's (NYSE: MCD) for the fresher, newer Burger King stock? Sell Big Macs for Whoppers? Lose Chicken McNuggets for Chicken Tenders?
No. Cramer thinks that for the near-term player, Burger King might be fun as there are still a lot of catalysts to sort out. It just closed the business combination with Justice Holdings, leading to board shake-up and plenty of volatility.
Overall, investors might look at things like input costs and domestic economic data. Costs are still high or moving higher in several segments (wheat, corn) while jobs aren't coming back or being created as rapidly as expected. While McDonald's will be able to absorb most of those fluctuations, Burger King might have investors a little more nervous.
Along with its longevity, McDonald's also has a dividend with 3.1 percent yield. With McDonald's about 13 percent off highs hit in January, investors might do well to order up some shares. To go.
In Tuesday afternoon trading, McDonald's is up 0.8 percent while Burger King is down 2 percent.
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