McDonald's (MCD) is Still a Buy -Cramer

Last night on CNBC's Mad Money, host Jim Cramer enlightened viewers on something he called an "analyst hissy-fit". Cramer said that investment firms sometimes panic and change their investment ratings on great companies due to near-term concerns. Cramer told watchers of his show that McDonald's (NYSE: MCD) recent sell-off is a great example of this phenomenon.

Cramer said the story began after McDonald's reported flat same store sales for the month of December, sending its stock tumbling about 6% from $54 to $51 in one day. The day after, Bear Stearns downgraded shares of McDonald's based only on the weak U.S. same store sales. Contrarily, Cramer said the right thing to do would have been to pick up some McDonald's after the downgrade as the stock had fallen to almost $50. Jim noted that investors who took advantage of the downgrade would have picked up an easy 10% gain as McDonald's stock is once again trading around $56.

Cramer cited one of his favorite investment mantra's at this time: 'no one ever made a dime panicking'. He told investors that Bear Stearns should have recognized that restaurants such as McDonald's cannot be traded off only one month of results, and this certainly proved true when McDonald's reported January's global comps rose 5.7% due to strong international spending during the month.

Cramer pointed out that McDonald's is a true international play and believes that its international business is the real growth engine behind the stock as domestic sales only make up about 35% of revenues. Cramer still considers McDonald's a Buy, even though it is up 10% since its recent low.

Jim's main point of the segment: "don't believe everything the analysts say".

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