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Red Hot Summer Stock 2: McDonald's (MCD)

June 19, 2009

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It's week two, and our Red Hot Summer Stocks are already heating up. Our first stock, FPL Group (FPL) is up 3% this week, while the Dow is down 3%! (See the complete write-up on FPL here.)

This market-beating performance comes when we combine the investing expertise of the top-rated investment experts in the country and hone in on the handful of select stocks they agree on.

This week's Hot Stock is truly a one-of-a-kind — it comes highly recommended by four separate InvestorPlace experts.

Agreement on one stock by a growth investor, a value investor, a low risk investor and one expert who focuses solely on powerful transformational change is an opportunity you can't afford to miss.

Let's not waste another minute. Here are all the details on our second Red Hot Summer Stock.

An Old Dog With a New Trick

In the world of high-end specialty coffee, there's a new contender. Over the last decade, Starbucks (SBUX) has set the standard for how coffee should look, taste and what it should cost. But now there's a new kid on the block: McDonald's (MCD).

It's crazy, but the new McCafe line of specialty coffees is giving McDonald's a whole new revenue stream from a mostly new customer base — and giving established roasters a run for their money.

The McCafe business is the best example of why McDonald's is such a relevant company and a great buy right now.

This is a company that isn't afraid to break into new markets and deliver what each generation craves. Case in point: Back in the 1980s and '90s, chicken sandwiches and salads became a staple of the menu as health-conscious diners sought affordable meals on the go.

Now fast-forward to today to a time where it's almost unheard of to be walking around town without a cup of coffee in your hand. McDonalds's has dived in arches-first and created one heck of a coffee selection.

McDonald's is so tuned in to what consumers want that it's been a staple of U.S. culture for over half a century. So 50 years and a little over 100 billion burgers later, McDonald's has earned its status as the go-to restaurant for hungry people looking for an affordable hot meal in a hurry.

The Real Sizzle for McDonald's

Now let's take a look at the economics that have pushed this stock to the forefront of our Red Hot Summer Stock lineup: the recession and the dollar.