Arcos Dorados Shares Drop Despite Positive Market Performance
April 26, 2023
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Despite the positive performance of the market, the stock of Arcos Dorados ($NYSE:ARCO), the world’s largest McDonald’s franchisor, dropped to $7.83 in the latest trading session, a decrease of 1.51% compared to the previous day’s closing price. This has caught the attention of investor and analysts alike as they try to understand why the company’s stock has performed so poorly. The company is committed to providing quality service and a great experience for its customers, and it has put in place an extensive global expansion plan to further strengthen its presence in the region.
Arcos Dorados also has an innovative approach to adapting their products and services to local cultures and trends, which has helped them establish a strong foothold in their markets. With such positive factors in play, it is surprising to see the company’s stock underperforming.
Price History
On Monday, shares of Arcos Dorados, the world’s largest McDonald’s franchisee, dropped despite a positive performance in the overall market. The company’s stock opened at $7.9 and closed at $8.0, up 2.6% from its last closing price of $7.8. The company’s stock has been hit hard by the pandemic and the resulting economic downturn. Investors have remained cautious when it comes to Arcos Dorados’ stock, as many are concerned about the long-term outlook for the company. With the global economy still recovering from the pandemic, investors are wary of investing in a company that is heavily reliant on consumer spending.
However, the company has taken steps to boost its resilience, such as diversifying its revenue sources with new partnerships and expanding its digital presence. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Arcos Dorados. More…
| Total Revenues | Net Income | Net Margin |
| 3.38k | 45.49 | 2.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Arcos Dorados. More…
| Operations | Investing | Financing |
| 345.44 | -259.65 | -59.98 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Arcos Dorados. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.64k | 2.31k | 1.54 |
Key Ratios Snapshot
Some of the financial key ratios for Arcos Dorados are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 4.5% | 17.7% | 4.8% |
| FCF Margin | ROE | ROA |
| 3.8% | 38.1% | 3.4% |
Analysis
At GoodWhale, we recently completed an analysis of ARCOS DORADOS, and have determined that it is a medium risk investment in terms of financial and business aspects. We have examined their financials and our Risk Rating has determined the level of risk the company poses for investors. However, during our analysis we have also detected two risk warnings in their income sheet and balance sheet. In order to gain access to these risk warnings, register with us and we will provide you with further insight into the company’s financials. Once registered, you will be able to leverage our analysis and make an informed decision about your investment in ARCOS DORADOS. With our comprehensive analysis tool, you will have all the information you need to make a smart and educated decision about your investment. More…
Peers
Arcos Dorados Holdings Inc is the world’s largest franchisor of McDonald’s restaurants. The company operates or franchises over 1,700 McDonald’s restaurants in 20 countries and territories in Latin America and the Caribbean. Arcos Dorados is headquartered in Buenos Aires, Argentina. The company’s primary competitors are Del Taco Restaurants Inc, Amrest Holdings SE, and Alsea SAB de CV.
– Del Taco Restaurants Inc ($LTS:0OGQ)
Amrest Holdings SE is a holding company that operates in the restaurant and retail industry. It has a market cap of 4B as of 2022 and a return on equity of 14.44%. The company operates in Europe, the Middle East, Africa, Asia, and the United States. It operates through its subsidiaries, including Pizza Hut, KFC, Burger King, and Starbucks. The company was founded in 1993 and is headquartered in Warsaw, Poland.
– Amrest Holdings SE ($OTCPK:ALSSF)
Alsea SAB de CV is a Mexican holding company that operates in the food and beverage industry. Through its subsidiaries, Alsea SAB de CV engages in the development, operation, and franchising of restaurant brands in Mexico, Argentina, Chile, Colombia, and Brazil. As of 2022, Alsea SAB de CV had a market capitalization of 1.59 billion and a return on equity of 52.23%. The company’s subsidiaries include Alsea Ventures, Alsea Restaurants, Alsea Brands, and Alsea Food Service.
Summary
Arcos Dorados is a Latin American fast-food restaurant chain and the largest McDonald’s franchisee in the world. Investing analysis of the company is mixed, with the stock recently declining 1.51%. Factors such as changing consumer tastes, market volatility, and the emergence of competitors could affect the stock in the long-term. Investors should carefully consider the current trends and potential risks when analyzing Arcos Dorados. With its large customer base, multiple locations and well-established brand recognition, the company has the potential to deliver a good return on investment for investors.
However, investors must also be mindful of industry changes and other external forces that could have an impact on their investments.
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