Arcos Dorados Holdings Inc. (ARCO) Stock AnalysisARCOStock AnalysisArcos Dorados Holdings Inc.

Arcos Dorados Holdings Inc. is a McDonald's franchisee. The Company operates or franchises over 2,140 McDonald's-branded restaurants. It divides its operations into four geographical divisions: Brazil; the Caribbean division, consisting of Aruba, Colombia, Curacao, French Guiana, Guadeloupe, Martinique, Puerto Rico, Trinidad and Tobago, the United States Virgin Islands of Saint Croix and Saint Thomas, and Venezuela; the North Latin America division (NOLAD), consisting of Costa Rica, Mexico and Panama, and the South Latin America division (SLAD), consisting of Argentina, Chile, Ecuador, Peru and Uruguay. Its menus feature over three tiers of products: entry-level options, such as its Big Pleasures, Small Prices offerings and Almuerzos Colombianos (Colombian Lunches) in Colombia; core menu options, such as the Big Mac, Happy Meal and Quarter Pounder, and premium options, such as Big Tasty or Angus premium hamburgers and chicken sandwiches and low-calorie or low-sodium products. It operates in the Consumer Cyclicals sector (EATING PLACES industry).

Arcos Dorados is a good buy right now due to its current price of $8, a low forward P/E ratio of 14.51, and a recent earnings surprise of 46.67%. The company shows a solid revenue growth trend, with Q2 2026 revenue reaching $1.3 billion, and a net income of $45 million, indicating strong profitability. However, the main risk is its high debt-to-equity ratio of 119.17%, which suggests reliance on borrowed funds.

4 analysts cover ARCO: 4 rate it Buy, 0 Hold and 0 Sell. The average price target is 8.50.