McDonald's Corp reported a higher-than-expected 4.9 percent rise in April sales at established restaurants on strength in Europe and the United States, and its shares rose 3.4 percent.
The world's biggest fast-food chain has been outperforming its U.S. rivals with help from its new beverage business that offers high-profit drinks like lattes and frappes and its discount Dollar Menus that cover breakfast, lunch and dinner.
McDonald's has nearly 14,000 U.S. restaurants in the United States -- far more than rivals like Burger King and Wendy's/Arby's .
It has more money to spend on advertising and is far ahead of competitors when it comes to selling breakfast. The chain also appeals to a broader set of customers, including retirees, ethnic groups and families.
Brands like Burger King and Yum Brands Inc's Taco Bell are stronger with the young men who frequent fast-food chains, but that group is grappling with unemployment that is far higher than the national rate of 9.9 percent.
McDonald's sales trends have tracked with the health of the U.S. economy. Domestic sales at restaurants open at least 13 months were down 0.7 percent in January and up 0.6 percent in February. As consumer spending ticked up in March, McDonald's U.S. same-store sales jumped 4.2 percent.
April's rise came in at 3.8 percent, following a 6.1 percent rise in April 2009.
Strong demand for beverages, including new McCafe offerings like Frappes, and existing items like Chicken McNuggets boosted April sales, the company said in a statement on Monday.
Analysts said monthly same-store sales hurdles should get easier as McDonald's laps weaker year-ago results.
Monthly comparisons for the rest of the year are pretty darn easy. That will help them, Edward Jones analyst Jack Russo told Reuters.
McDonald's shares rose $2.27 to $70.30 in morning trade.
Sales at McDonald's restaurants open at least 13 months were up 5.3 percent in Europe, helped by restaurant renovations, and 3.9 percent in the Asia/Pacific, Middle East and Africa region.
Jefferies & Co analyst Jeff Farmer said in a recent client note that he was looking for global same-restaurant sales to rise 4.9 percent, slightly above Wall Street's call for growth of 4.5 percent.
Farmer's forecast included a 3.8 percent rise in the United States -- below the Street's call for a 4.1 percent increase -- and gains of 4 percent in Europe and 5 percent in Asia/Pacific, Middle East and Africa.
The pace of sales in the United States and Europe, its largest markets, slowed from March levels, as expected.
In March, global same-store sales jumped 5.2 percent. That also included gains of 5.9 percent in Europe and 2.8 percent in Asia/Pacific, Middle East and Africa.
Shares in smaller rival Burger King Holdings Inc were up 4.4 percent. The stock of Wendy's/Arby's Group Inc, which reports quarterly results on Thursday, was up 6.6 percent.
U.S. stocks rallied on Monday after European policymakers agreed to a $1 trillion rescue package to stabilize world financial markets and to help resolve the euro zone debt crisis.
(Reporting by Lisa Baertlein and Dhanya Skariachan; Editing by Lisa Von Ahn, Derek Caney, Dave Zimmerman)