(ARCO) Arcos Dorados Holdings - NYSE
Sector: Consumer Cyclical | Industry: Restaurants | Exchange: NYSE (USA) | Market Cap: 1.845m USD | Total Return: 17.2% in 12m
Avg Turnover: 11.8M
EPS Trend: -90.5%
Qual. Beats: 1
Rev. Trend: 89.8%
Qual. Beats: 0
Warnings
Choppy Below Avwap Earnings
Tailwinds
No distinct edge detected
Arcos Dorados Holdings Inc. is the worlds largest independent McDonalds franchisee, maintaining exclusive rights to operate and sub-franchise the brand across 20 countries and territories in Latin America and the Caribbean. Headquartered in Uruguay, the company manages a vast geographic footprint that includes major markets such as Brazil, Mexico, and Argentina.
The business model relies on a master franchise agreement, which requires the company to pay royalties based on a percentage of gross sales in exchange for brand intellectual property and operational support. In the quick-service restaurant sector, geographic diversification helps mitigate localized economic volatility, though it exposes the entity to significant currency exchange risks across emerging markets.
Further analysis of dividend yield and valuation multiples is available on ValueRay to assist with your due diligence. Arcos Dorados remains a primary vehicle for investors seeking exposure to consumer discretionary spending and middle-class expansion within the Latin American region.
- Brazil market performance dictates overall revenue growth and consolidated EBITDA margins
- Local currency volatility against the US dollar impacts reported financial results
- Regional inflation levels influence menu pricing strategies and consumer purchasing power
- McDonald’s master franchise agreement terms govern royalty costs and expansion mandates
- Digital sales penetration and delivery platform adoption drive comparable store growth
| Net Income: 234.3m TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.01 > 0.02 and ΔFCF/TA 2.95 > 1.0 |
| NWC/Revenue: -3.54% < 20% (prev -3.14%; Δ -0.40% < -1%) |
| CFO/TA 0.08 > 3% & CFO 306.6m > Net Income 234.3m |
| Net Debt (3.07b) to EBITDA (621.0m): 4.95 < 3 |
| Current Ratio: 0.80 > 1.5 & < 3 |
| Outstanding Shares: last quarter (210.7m) vs 12m ago 0.00% < -2% |
| Gross Margin: 12.21% > 18% (prev 12.86%; Δ -0.65% > 0.5%) |
| Asset Turnover: 132.2% > 50% (prev 128.8%; Δ 3.45% > 0%) |
| Interest Coverage Ratio: 9.60 > 6 (EBIT TTM 415.8m / Interest Expense TTM 43.3m) |
| A: -0.04 (Total Current Assets 694.1m - Total Current Liabilities 864.5m) / Total Assets 3.82b |
| B: 0.21 (Retained Earnings 803.1m / Total Assets 3.82b) |
| C: 0.11 (EBIT TTM 415.8m / Avg Total Assets 3.64b) |
| D: 0.25 (Book Value of Equity 775.4m / Total Liabilities 3.04b) |
| Altman-Z'' = 1.43 = BB |
| DSRI: 0.78 (Receivables 159.7m/190.5m, Revenue 4.82b/4.47b) |
| GMI: 1.05 (GM 12.86% / 12.21%) |
| AQI: 1.29 (AQ_t 0.16 / AQ_t-1 0.12) |
| SGI: 1.08 (Revenue 4.82b / 4.47b) |
| TATA: -0.02 (NI 234.3m - CFO 306.6m) / TA 3.82b) |
| Beneish M = -2.93 (Cap -4..+1) = A |
As of June 17, 2026, the stock is trading at USD 8.69 with a total of 533,258 shares traded.
Over the past week, the price has changed by +4.83%,
over one month by +4.70%,
over three months by +12.53% and
over the past year by +17.18%.
Arcos Dorados Holdings has received a consensus analysts rating of 4.13. Therefore, it is recommended to buy ARCO.
- StrongBuy: 2
- Buy: 5
- Hold: 1
- Sell: 0
- StrongSell: 0
| Analysts Target Price | 11 | 27% |
P/E Trailing = 7.8919
P/E Forward = 14.5138
P/S = 0.3831
P/B = 2.2766
P/EG = 0.5441
Revenue TTM = 4.82b USD
EBIT TTM = 415.8m USD
EBITDA TTM = 621.0m USD
Long Term Debt = 969.3m USD (from longTermDebt, last quarter)
Short Term Debt = 162.6m USD (from shortTermDebt, last quarter)
Debt = 3.34b USD (from shortLongTermDebtTotal, last quarter) + Leases 1.16b
Net Debt = 3.07b USD (calculated: Debt 3.34b - CCE 266.2m)
Enterprise Value = 4.92b USD (1.85b + Debt 3.34b - CCE 266.2m)
Interest Coverage Ratio = 9.60 (Ebit TTM 415.8m / Interest Expense TTM 43.3m)
EV/FCF = 89.85x (Enterprise Value 4.92b / FCF TTM 54.8m)
FCF Yield = 1.11% (FCF TTM 54.8m / Enterprise Value 4.92b)
FCF Margin = 1.14% (FCF TTM 54.8m / Revenue TTM 4.82b)
Net Margin = 4.86% (Net Income TTM 234.3m / Revenue TTM 4.82b)
Gross Margin = 12.21% ((Revenue TTM 4.82b - Cost of Revenue TTM 4.23b) / Revenue TTM)
Gross Margin QoQ = 10.99% (prev 14.25%)
Tobins Q-Ratio = 1.29 (Enterprise Value 4.92b / Total Assets 3.82b)
Interest Expense / Debt = 1.30% (Interest Expense 43.3m / Debt 3.34b)
Taxrate = 37.37% (140.0m / 374.8m)
NOPAT = 260.4m (EBIT 415.8m * (1 - 37.37%))
Current Ratio = 0.80 (Total Current Assets 694.1m / Total Current Liabilities 864.5m)
Debt / Equity = 4.31 (Debt 3.34b / totalStockholderEquity, last quarter 775.4m)
Debt / EBITDA = 4.95 (Net Debt 3.07b / EBITDA 621.0m)
Debt / FCF = 56.15 (Net Debt 3.07b / FCF TTM 54.8m)
Total Stockholder Equity = 717.7m (last 4 quarters mean from totalStockholderEquity)
RoA = 6.43% (Net Income 234.3m / Total Assets 3.82b)
RoE = 32.65% (Net Income TTM 234.3m / Total Stockholder Equity 717.7m)
RoCE = 24.64% (EBIT 415.8m / Capital Employed (Equity 717.7m + L.T.Debt 969.3m))
RoIC = 9.05% (NOPAT 260.4m / Invested Capital 2.88b)
WACC = 3.42% (E(1.85b)/V(5.19b) * Re(8.14%) + D(3.34b)/V(5.19b) * Rd(1.30%) * (1-Tc(0.37)))
Discount Rate = 8.14% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: 56.57 | Cagr: 0.00%
[DCF] Terminal Value 75.44% ; FCFF base≈54.8m ; Y1≈55.0m ; Y5≈58.2m
[DCF] Fair Price = N/A (negative equity: EV 905.9m - Net Debt 3.07b = -2.17b; debt exceeds intrinsic value)
EPS Correlation: -90.48 | EPS CAGR: -16.19% | SUE: 1.12 | # QB: 1
Revenue Correlation: 89.81 | Revenue CAGR: 5.10% | SUE: 0.27 | # QB: 0
EPS current Quarter (2026-06-30): EPS=0.14 | Chg30d=N/A | Revisions=N/A | Analysts=1
EPS next Quarter (2026-09-30): EPS=0.16 | Chg30d=N/A | Revisions=N/A | Analysts=1
EPS current Year (2026-12-31): EPS=0.79 | Chg30d=+6.95% | Revisions=+33% | GrowthEPS=-24.0% | GrowthRev=+11.7%
EPS next Year (2027-12-31): EPS=0.86 | Chg30d=-0.13% | Revisions=+25% | GrowthEPS=+9.6% | GrowthRev=+6.5%
[Analyst] Revisions Ratio: +33%