Arcos Stock Buy Hold or Sell Recommendation
| ARCO Stock | USD 9.74 0.49 4.79% |
Given the investment horizon of 90 days and your above-average risk tolerance, our recommendation regarding Arcos Dorados Holdings is 'Buy'. Macroaxis provides Arcos Dorados buy-hold-or-sell recommendation only in the context of selected investment horizon and investor attitude towards risk assumed by holding ARCO positions. The advice algorithm takes into account all of Arcos Dorados' available fundamental, technical, and predictive indicators you will find on this site.
Real Value 10.99 | Target Price 13.5 | Hype Value 9.74 | Market Value 9.74 | Naive Value 9.94 |
A buy or sell recommendation provided by Macroaxis is an automated directive regarding whether to purchase or sell Arcos Dorados Holdings given historical horizon and risk tolerance towards Arcos Dorados. When Macroaxis issues a 'buy' or 'sell' recommendation for Arcos Dorados Holdings, the advice is generated through an automated system that utilizes algorithms and statistical models.
Arcos |
Execute Arcos Dorados Buy or Sell Advice
The Arcos recommendation should be used to complement the buy-or-sell advice compiled from the current analysts' consensus on Arcos Dorados Holdings. Macroaxis does not own or have any residual interests in Arcos Dorados Holdings or other equities on which the buy-or-sell advice is provided. Please provide your input below to execute Arcos Dorados' advice using the current market data and latest reported fundamentals.
Time Horizon
Risk Tolerance
 |  |
Buy
Arcos Dorados Trading Alerts and Improvement Suggestions
| Arcos Dorados generated a negative expected return over the last 90 days | |
| The company currently holds 1.56 B in liabilities with Debt to Equity (D/E) ratio of 7.4, indicating the company may have difficulties to generate enough cash to satisfy its financial obligations. Arcos Dorados Holdings has a current ratio of 0.84, indicating that it has a negative working capital and may not be able to pay financial obligations when due. Debt can assist Arcos Dorados until it has trouble settling it off, either with new capital or with free cash flow. So, Arcos Dorados' shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Arcos Dorados Holdings sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Arcos to invest in growth at high rates of return. When we think about Arcos Dorados' use of debt, we should always consider it together with cash and equity. | |
| Arcos Dorados has a strong financial position based on the latest SEC filings | |
| Latest headline from finance.yahoo.com: McDonalds Expands Collaboration with UBQ Materials, Becoming First Restaurant Chain to Incorporate UBQ into Building Materials |
Arcos Dorados Returns Distribution Density
The distribution of Arcos Dorados' historical returns is an attempt to chart the uncertainty of Arcos Dorados' future price movements. The chart of the probability distribution of Arcos Dorados stock daily returns describes the distribution of returns around its average expected value. We use Arcos Dorados Holdings price's Value At Risk and its Upside Potential as a relative measure of the distribution. The graph of the distribution of Arcos Dorados returns is essential to provide solid investment advice for Arcos Dorados.
| Mean Return | 0.07 | Value At Risk | -3.42 | Potential Upside | 2.94 | Standard Deviation | 2.09 |
Return Density |
| Distribution |
Investment risk management requires an estimate of the probability of extreme price changes. Therefore, the correct representation of the distribution of Arcos Dorados historical returns presented in an easy-to-digest graphical form helps investors and money managers understand the risk-reward trade-off of different investement strategies.
Arcos Dorados Cash Flow Accounts
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 (projected) | ||
| Capital Expenditure | (194.15 M) | (261.89 M) | (85.51 M) | (113.01 M) | (214.4 M) | (231.33 M) | |
| Depreciation Amortization and Accretion | 105.8 M | 123.22 M | 126.85 M | 120.39 M | 119.78 M | 127.41 M | |
| Net Cash Flow or Change in Cash and Cash Equivalents | (111.21 M) | (75.4 M) | 44.11 M | 112.84 M | (11.89 M) | (12.21 M) | |
| Net Cash Flow Business Acquisitions and Disposals | 10.16 M | 2.16 M | (3.83 M) | (185 K) | (4.8 M) | (4.93 M) | |
| Net Cash Flow from Financing | (73.44 M) | (29.63 M) | 126.01 M | (17.93 M) | (59.98 M) | (61.56 M) | |
| Net Cash Flow from Investing | (163.78 M) | (260.99 M) | (88.71 M) | (108.28 M) | (259.65 M) | (280.15 M) | |
| Net Cash Flow from Operations | 179.73 M | 223.48 M | 15.97 M | 258.04 M | 345.44 M | 297.33 M | |
| Effect of Exchange Rate Changes on Cash | (53.71 M) | (8.26 M) | (9.16 M) | (19 M) | (37.7 M) | (38.7 M) | |
| Share Based Compensation | 2.64 M | 4.06 M | 1.36 M | 758 K | 6.09 M | 4.9 M |
Arcos Dorados Greeks
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Arcos Dorados or Hotels, Restaurants & Leisure sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Arcos Dorados' price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Arcos stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
α | Alpha over NYSE Composite | 0.09 | |
β | Beta against NYSE Composite | 1.82 | |
σ | Overall volatility | 2.09 | |
Ir | Information ratio | 0.0367 |
Arcos Dorados Volatility Alert
Arcos Dorados Holdings currently demonstrates below-average downside deviation. It has Information Ratio of 0.04 and Jensen Alpha of 0.09. However, we advise investors to further question Arcos Dorados Holdings expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Arcos Dorados' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Arcos Dorados' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.Arcos Dorados Fundamentals Vs Peers
Comparing Arcos Dorados' fundamentals to the average values of its peers is one of the most widely used and accepted methods of equity analyses. It helps to analyze Arcos Dorados' direct or indirect competition across all of the common fundamentals between Arcos Dorados and the related equities. This way, we can detect undervalued stocks with similar characteristics as Arcos Dorados or determine the stocks which would be an excellent addition to an existing portfolio. Peer analysis of Arcos Dorados' fundamental indicators could also be used in its relative valuation, which is a method of valuing Arcos Dorados by comparing valuation metrics with those of similar companies.
| Better Than Average | Worse Than Average | Compare Arcos Dorados to competition |
| Fundamentals | Arcos Dorados | Peer Average |
| Return On Equity | 0.54 | -0.31 |
| Return On Asset | 0.0712 | -0.14 |
| Profit Margin | 0.0421 % | (1.27) % |
| Operating Margin | 0.07 % | (5.51) % |
| Current Valuation | 3.6 B | 16.62 B |
| Shares Outstanding | 130.66 M | 571.82 M |
| Shares Owned by Insiders | 3.25 % | 10.09 % |
| Shares Owned by Institutions | 43.20 % | 39.21 % |
| Number of Shares Shorted | 2.4 M | 4.71 M |
| Price to Earning | 11.52 X | 28.72 X |
| Price to Book | 6.58 X | 9.51 X |
| Price to Sales | 0.47 X | 11.42 X |
| Revenue | 3.62 B | 9.43 B |
| Gross Profit | 492.61 M | 27.38 B |
| EBITDA | 264.42 M | 3.9 B |
| Net Income | 140.34 M | 570.98 M |
| Cash and Equivalents | 289.42 M | 2.7 B |
| Cash per Share | 1.37 X | 5.01 X |
| Total Debt | 1.56 B | 5.32 B |
| Debt to Equity | 7.40 % | 48.70 % |
| Current Ratio | 0.86 X | 2.16 X |
| Book Value Per Share | 1.92 X | 1.93 K |
| Cash Flow from Operations | 345.44 M | 971.22 M |
| Short Ratio | 2.31 X | 4.00 X |
| Earnings Per Share | 0.79 X | 3.12 X |
| Price to Earnings To Growth | 2.15 X | 4.89 X |
| Target Price | 13.21 | |
| Beta | 1.07 | -0.15 |
| Market Capitalization | 2.05 B | 19.03 B |
| Total Asset | 2.64 B | 29.47 B |
| Retained Earnings | 424.94 M | 9.33 B |
| Working Capital | (75.05 M) | 1.48 B |
| Current Asset | 379 M | 9.34 B |
About Arcos Dorados Buy or Sell Advice
When is the right time to buy or sell Arcos Dorados Holdings? Buying financial instruments such as Arcos Stock isn't very hard. However, what challenging for most investors is doing it at the right time to beat the market. Proper market timing is something most people cannot do without sophisticated tools, which help to isolate the right opportunities. Macroaxis provides hands-on modules to deliver winning trades and diversify your portfolios on a daily basis. Most of our advising modules are very easy to use and apply.
Please read more on our stock advisor page.| 2020 | 2021 | 2022 | 2023 (projected) | Current Assets | 415.53 M | 540.12 M | 684.36 M | 578.46 M | Total Assets | 2.29 B | 2.36 B | 2.64 B | 2.55 B |
Use Investing Ideas to Build Portfolios
In addition to having Arcos Dorados in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
Run Coal Thematic Idea Now
Coal
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Coal theme has 10 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Coal Theme or any other thematic opportunities.
| View All Next | Launch |
Check out Arcos Dorados Analyst Recommendation to compare Macroaxis Buy or Sell Recommendation with the current analyst consensus. To check ratings for multiple equity instruments, please use the Instant Ratings tool. Note that the Arcos Dorados Holdings information on this page should be used as a complementary analysis to other Arcos Dorados' statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Complementary Tools for Arcos Stock analysis
When running Arcos Dorados' price analysis, check to measure Arcos Dorados' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Arcos Dorados is operating at the current time. Most of Arcos Dorados' value examination focuses on studying past and present price action to predict the probability of Arcos Dorados' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Arcos Dorados' price. Additionally, you may evaluate how the addition of Arcos Dorados to your portfolios can decrease your overall portfolio volatility.
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |
Is Arcos Dorados' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Arcos Dorados. If investors know Arcos will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Arcos Dorados listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 0.89 | Dividend Share 0.19 | Earnings Share 0.79 | Revenue Per Share 18.858 | Quarterly Revenue Growth 0.172 |
The market value of Arcos Dorados Holdings is measured differently than its book value, which is the value of Arcos that is recorded on the company's balance sheet. Investors also form their own opinion of Arcos Dorados' value that differs from its market value or its book value, called intrinsic value, which is Arcos Dorados' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Arcos Dorados' market value can be influenced by many factors that don't directly affect Arcos Dorados' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Arcos Dorados' value and its price as these two are different measures arrived at by different means. Investors typically determine if Arcos Dorados is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Arcos Dorados' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.