ETF Comparison
KO vs MCD: Which Is the Better Pick in 2026?
A head-to-head comparison of The Coca-Cola Company and McDonald's Corporation covering yield, cost, risk, and income potential.
Data updated July 4, 2026
Side-by-side snapshot
| KO | MCD | |
|---|---|---|
| Full name | The Coca-Cola Company | McDonald's Corporation |
| Issuer | — | — |
| Last Close | $84.14 as of July 4, 2026 | $280.63 as of July 4, 2026 |
| Distribution yield | 2.56% | 2.76% |
| Distribution Safety Score | 100 | 100 |
| Expense ratio | — | — |
| AUM | — | — |
| Distribution frequency | Quarterly | Quarterly |
| Underlying index | — | — |
| Objective | Manufactures, distributes, and markets nonalcoholic beverage concentrates, syrups, and finished beverages worldwide. | Operates and franchises McDonald's restaurants serving a locally relevant menu of food and beverages in more than 100 countries worldwide. |
| Asset class | Equity | Equity |
| Inception date | N/A | N/A |
| Beta | 0.354 | 0.414 |
| Last dividend | $0.5300 | $1.8600 |
| Ex-dividend date | 06/15/2026 | 06/02/2026 |
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Visual comparison
Key metrics
Projected income on $10K
Projections assume the current yield and share price remain constant. Actual results will vary.
Total returns
KO has outpaced MCD over the trailing twelve months, posting a 20.72% total return against -4.03%. The picture flips over 10 years, though — MCD has compounded at 11.41% a year, ahead of KO at 9.80%. Figures are total returns: price change plus every distribution reinvested.
| Symbol | YTD | 1Y | 3Y | 5Y | 10Y | Since Jul 1966 | Volatility | Sharpe | Sortino | Max drawdown |
|---|---|---|---|---|---|---|---|---|---|---|
| KO | 23.36% | 20.72% | 14.92% | 12.57% | 9.80% | 12.30% | 15.9% | 0.60 | 0.90 | -16.3% |
| MCD | -6.95% | -4.03% | 0.49% | 6.12% | 11.41% | 20.34% | 17.7% | -0.23 | -0.31 | -22.0% |
Total return with all distributions reinvested on the ex-dividend date, split-adjusted, as of July 2, 2026. YTD and 1Y are cumulative; longer windows are annualized. “Since Jul 1966” measures every fund from July 5, 1966 — the youngest fund's first trading day — so all funds share one comparison window. Volatility is the annualized standard deviation of daily total returns over the trailing 3 years. Sharpe and Sortino divide the annualized return in excess of the risk-free rate by, respectively, that volatility and the downside deviation (both over the trailing 3 years) — higher is better. Max drawdown is the largest peak-to-trough total-return decline over the same window — shallower is better.
Quick verdict
KO (The Coca-Cola Company) and MCD (McDonald's Corporation) are both quarterly-pay stocks, but they take different approaches.
MCD offers the higher yield at 2.76% vs 2.56% for KO. A higher yield means more current income per dollar invested, though it may come with different risk characteristics.
Deep dive
Yield & income
On a $10,000 investment, KO would generate roughly $21.33/month, while MCD would produce $23.00/month, at current distribution rates. Both pay quarterly distributions.
Cost & efficiency
Over 10 years on $10,000, KO would cost approximately $0 in fees vs $0 for MCD (simplified, not compounded). Both charge the same expense ratio.
Strategy & risk
KO is a stock, while MCD is a stock. Beta is 0.354 for KO and 0.414 for MCD, indicating KO is less volatile relative to the market.
Fund details
KO is managed by — (launched 01/02/1962) with — in assets. MCD is managed by — (launched 07/05/1966) with — in assets.
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Frequently asked questions
Is KO or MCD better for dividend income?
It depends on your goals. MCD currently offers the higher distribution yield, which means more income per dollar invested. However, a lower-yield fund may offer better total return or lower volatility. Consider your time horizon and risk tolerance.
What is the difference between KO and MCD?
KO (The Coca-Cola Company) is a stock, while MCD (McDonald's Corporation) is a stock. They are issued by — and — respectively.
Can I hold both KO and MCD?
Yes. Many income investors hold both to diversify across different strategies and underlying indexes. This can reduce concentration risk while maintaining a strong income stream.
Which has lower fees, KO or MCD?
KO has an expense ratio of — while MCD charges —. Lower fees mean more of your investment returns stay in your pocket over time.
How much income does $10,000 in KO vs MCD generate?
At current rates, $10,000 in KO would generate roughly $21.33 per month ($256.00 annually). The same in MCD would produce about $23.00 per month ($276.00 annually).
Which has performed better historically, KO or MCD?
KO has outpaced MCD over the trailing twelve months, posting a 20.72% total return against -4.03%. The picture flips over 10 years, though — MCD has compounded at 11.41% a year, ahead of KO at 9.80%. Figures are total returns: price change plus every distribution reinvested. Past performance does not guarantee future results.
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KO vs MCD — at a glance
Generated June 2026 from current fund data.
Overview
Coca-Cola and McDonald's are both mature, dividend-paying consumer stocks with steady historical capital appreciation and modest yields. KO manufactures and distributes beverages globally; MCD operates and franchises quick-service restaurants across 100+ countries. The key difference lies in their business models: KO earns revenue from product sales and concentrate licensing, while MCD generates recurring income from franchise fees and royalties—a structurally more stable cash-flow engine than KO's exposure to commodity input costs and consumer spending volatility.
How they differ
MCD's franchise-heavy model produces more predictable cash flows than KO's product-sales business. A McDonald's franchisee pays rent and royalties regardless of economic conditions; Coca-Cola depends on bottler demand and retail volume, which compress during downturns. MCD's yield of 2.72% slightly edges KO's 2.58%, though both distribute quarterly. More importantly, MCD carries higher beta (0.414 vs. KO's 0.354), meaning it tends to swing more with broad market moves—a reflection of its exposure to consumer discretionary spending despite its defensive reputation. KO's lower beta reflects its status as a consumer staple with less cyclical revenue.
Who each is best for
KO: Fits investors prioritizing stability and defensive positioning—those seeking the lowest volatility in a dividend equity allocation and willing to accept modest single-digit annual yield in exchange for minimal earnings surprises.
MCD: Designed for income investors comfortable with slightly higher market sensitivity in exchange for a modestly higher dividend yield and recurring franchise-fee revenue that buffers downturns better than pure product sales.
Key risks to know
- Commodity cost exposure (KO): Coca-Cola's gross margins depend heavily on sugar, corn syrup, and aluminum prices. Sustained cost inflation can squeeze profitability faster than MCD's fee-based model absorbs it.
- Consumer spending cyclicality (MCD): Though franchising insulates it partially, MCD's systemwide sales and traffic still decline when discretionary spending falls, pressuring same-store sales and royalty growth.
- Currency headwinds (both): Both firms earn over 50% of revenue overseas, so strength in the U.S. dollar erodes reported earnings and can reduce dividend-growth capacity.
- Beta and market timing (MCD): MCD's higher market sensitivity means it may underperform KO during risk-off periods, despite its structural cash-flow advantages.
- Valuation and yield sustainability (KO): At 2.58%, KO's yield offers limited margin of safety; a meaningful pullback in earnings would pressure the payout ratio and dividend growth trajectory.
Bottom line
If you value downside cushion and minimal volatility, KO's lower beta and staple positioning stand out. If you prioritize franchise-driven cash stability and a slightly higher yield, MCD's recurring-revenue model offers a structural advantage—though it carries modestly more market sensitivity. Both are quality franchises; the choice hinges on whether you lean defensive or income-focused.
AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.
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