Credit Suisse analyst Jason West weighed in on McDonald’s Corporation (NYSE:MCD) in light of the Brexit vote and exposure to the European markets, predicting long term growth in spite of near-term headwinds due to MCD’s historical ability to withstand turmoil given the “defensive” nature of the business.

However, West notes that macro headwinds cause him to trim his current same-store sales estimates and EPS valuations for the company. The analyst notes, “[We are] Lowering estimates on MCD to reflect our recent US franchisee checks and potential fallout from the Brexit decision.”

The analyst also explains that McDonald’s has the single highest Europe/UK exposure among U.S. listed restaurants. Europe makes up approximately 37% of the company’s revenues, and the UK makes up an impressive 9% of total revenues alone. The analyst explicates, “Each 5% move in UK SSS = 0.3% impact to MCD global SSS.” For context, each 1% move in McDonald’s global same-store sales amounts to approximately $0.11 to EPS.

The analyst explains that meetings with several U/S franchisees to gauge 2Q trends revealed that 2Q started slow with similar modest improvements in May and June. The analyst notes that factors contributing to the slowdown, according to the franchisees, include “broad consumer pullback, weather, oil, softer than expected monopoly, lapping Sirloin burgers, and slowing tailwind from McPick 2 and all day breakfast.”

Despite these short-term headwinds, West reissues an Outperform rating for the stock with a price target o $130.00.

Jason West is a top-ranked performer on TipRanks, with a 59% success rate and an average return of 8.5%.

Jason West Pic

According to TipRanks, 47% of analysts issue a Buy rating for MCD, while another 47% maintain a Hold rating, and the remaining 6% uphold a Sell rating for the stock. The consensus price target is $131.17, marking a 12.79% upside from current prices.