They don’t call themselves “Fools” for nothing.  The Motley Fool guys reiterated their favorable position on McDonald’s today after a disappointing quarter.

True, fourth-quarter profit did drop at McDonald’s. Net income fell 23% to $985.3 million, or $0.87 per share. However, bear in mind that last year’s fourth-quarter earnings were boosted by a $0.33 per share tax benefit. Operating income increased 11% to $1.50 billion.

Revenue dipped 3% to $5.57 billion, with the decline resulting from a weaker dollar. However, McDonald’s comps continue to be impressive, despite these difficult economic times. Global comps surged 7.2%, with U.S. comps up 5%, Europe up 7.6%, and Asia/Pacific, Middle East, and Africa up 10%.

The fool’s and their readers can go ahead and buy McDonald’s but I won’t be touching it anywhere near today’s closing price of $58.31.  I will say that I agree with the Fool’s that McDonald’s is a decent company with long staying power.  But at these prices, they are PRICED BEYOND PERFECTION.  And in this environment, perfection is a hard target to achieve.

As for shorting McDonald’s, I won’t do until at least the $62.50 mark.  There are just far to many moronic fund managers ignoring fundamentals and driving prices higher.  These fund managers are the same idiots that were paying over $60 a share for Lennar – the company whose motto was “Buy any non buildable scrap of dirt for sale, and offer 200% of the selling price before someone else buys it first!”.

Bottom Line:  McDonald’s is still a DON’T BUY.

Disclosure: No current position on McDonalds.

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