The fast-food pick still will pay off in the long-term

MCD Struggling, But McDonalds Stock Remains a Solid Bet

McDonalds (MCD ) is trying to lure consumers into its restaurants by playing to the pumpkin-everything trend, as MCD is now offering a premium-priced pumpkin latte .

Trivial as it might seem, the drink fit for a Starbucks (SBUX ) is the latest example of just how badly McDonalds stock needs a jolt caffeine or otherwise.

MCD went from the best performer of the Dow Jones Industrial Average  in 2011 to one of the worst in 2012, posting an ugly 12% decline only dwarfed by drops at Hewlett-Pacakard (HPQ ) and Intel (INTC ). So far this year, McDonalds stock is in the black but still is notably lagging the broader market.

Since Jan. 1, McDonalds stock has climbed only 11% vs. 19% for the S&P 500 and 17% for the Dow. On top of that, fast-food rivals Wendys (WEN ) and Burger King Worldwide (BKW ) have climbed 54% and 20%, respectively, with only Yum Brands (YUM ) falling behind.

The bottom line: McDonalds has been a super-sized disappointment lately. Trust me, I know Ive been long MCD since mid-February.

Im not giving up on McDonalds stock just yet, though.

MCD Remains a Safe Bet

McDonalds stock surely isnt your best bet if youre looking for quick buck, but MCD remains a solid option for those looking long-term.

The main appeal of the stock is that McDonalds is a dividend-paying machine. The company has nearly doubled its dividend in the past five years alone, with McDonalds stocks current 77-cent quarterly payout yielding a mouth-watering 3.3%.

On top of that, you can count on McDonalds payout down the line, given the fact that it has been alive and kicking since 1976, that continued earnings growth is on tap and that MCD boasts nearly $2.3 billion in cash and short-term equivalents, along with annual operating cash flow of around $7 billion.

As Morningstar summed it up, McDonalds stock remains resilient. Its confidence in MCDs business stems from unrivaled scale advantages, an incredibly strong brand, a cohesive franchisee system and ample international growth opportunities.

Those features are exactly what will keep McDonalds stock chugging higher for years to come.

Sure, there are concerns for MCD stock in the wake of competition, weakness in Europe and Asia, health-conscious consumers, a lack of innovation and more. But the incumbent fast-food king will be able to weather those storms just as it has for decades in the past.

Even the new pumpkin-spice latte which I like considering McDonalds is a clear leader in the fast-food beverage market, and because this is a popular seasonal drink that should get consumers into the store and spending is one of many recent steps to address the lack of innovation. The company also recently announced chicken wings and steak breakfast sandwiches .

Meanwhile, Europes recovery continues to gain momentum, which will be a nice compliment to already-improving U.S. sales.

It will take just a few solid quarterly performances to help investors remember all of McDonalds stocks qualities of which there are plenty and eventually send shares higher.

So if youre looking for a safe and steady bet, ignore the haters. MCD stock is still it.

As of this writing, Alyssa Oursler was long MCD. Follow her on Twitter at @alyssaoursler .