Arcos Dorados Valuation
| ARCO Stock | USD 10.62 0.28 2.57% |
At this time, the firm appears to be undervalued. Arcos Dorados Holdings shows a prevailing Real Value of $12.23 per share. The current price of the firm is $10.62. Our model approximates the value of Arcos Dorados Holdings from analyzing the firm fundamentals such as profit margin of 0.04 %, and Return On Equity of 0.43 as well as examining its technical indicators and probability of bankruptcy. In general, most investors favor obtaining undervalued instruments and abandoning overvalued instruments since, at some point, asset prices and their ongoing real values will blend. Key fundamental drivers impacting Arcos Dorados' valuation include:
Price Book 5.2454 | Enterprise Value 3.8 B | Enterprise Value Ebitda 8.116 | Price Sales 0.5349 | Forward PE 14.5138 |
Undervalued
Today
Please note that Arcos Dorados' price fluctuation is not too volatile at this time. Calculation of the real value of Arcos Dorados Holdings is based on 3 months time horizon. Increasing Arcos Dorados' time horizon generally increases the accuracy of value calculation and significantly improves the predictive power of the methodology used.
Our valuation method for Arcos Dorados Holdings is useful when determining the fair value of the Arcos stock, which is usually determined by what a typical buyer is willing to pay for full or partial control of Arcos Dorados. Since Arcos Dorados is currently traded on the exchange, buyers and sellers on that exchange determine the market value of Arcos Stock. However, Arcos Dorados' intrinsic value may or may not be the same as its current market price, in which case there is an opportunity to profit from the mispricing, assuming the market price will eventually merge with its intrinsic value. | Historical | Market 10.62 | Real 12.23 | Target 13.24 | Hype 10.54 |
The real value of Arcos Stock, also known as its intrinsic value, is the underlying worth of Arcos Dorados Holdings Company, which is reflected in its stock price. It is based on Arcos Dorados' financial performance, assets, liabilities, growth prospects, management team, or industry conditions. The intrinsic value of Arcos Dorados' stock can be calculated using various methods such as discounted cash flow analysis, price-to-earnings ratio, or price-to-book ratio. That value may differ from its current market price, which is determined by supply and demand factors such as investor sentiment, market trends, news, and other external factors that may influence Arcos Dorados' stock price. It is important to note that the real value of any stock may change over time based on changes in the company's performance.
Estimating the potential upside or downside of Arcos Dorados Holdings helps investors to forecast how Arcos stock's addition to their portfolios will impact the overall performance. We also use other valuation drivers to help us estimate the true value of Arcos Dorados more accurately as focusing exclusively on Arcos Dorados' fundamentals will not take into account other important factors: Traditionally analysts and sophisticated investors use multiple methods for valuing a cash-flow-generating entity or its stock. For example, some money managers use Arcos Dorados' intrinsic value based on its ongoing forecasts of Arcos Dorados' financial statements. In contrast, other private, professional wealth advisors use a multiplier approach by looking to relative value analysis against Arcos Dorados' closest peers. When choosing an evaluation method for Arcos Dorados Holdings, ensure it is appropriate for the firm given its current financial situation and market classification. If more than one evaluation category is relevant, we suggest using both methods to arrive at a better estimate.
Arcos Dorados Investments |
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Arcos Valuation Trend
Knowing Arcos Dorados' actual value is paramount for traders to make sound investment determinations. Arcos Dorados' real value is not only important for the investor to make better decisions but also for a more accurate overall view of Arcos Dorados' financial worth over time since having this information enables investors and analysts to forecast the earnings more efficiently. Using both Arcos Dorados' enterprise value as well as its market capitalization is the best way to gauging the value of the company and is usually enough for investors to make market timing descisions.
Arcos Market Cap
Arcos Dorados Holdings is rated third in market capitalization category among related companies. Market capitalization of Consumer Discretionary industry is presently estimated at about 22.46 Billion. Arcos Dorados holds roughly 2.24 Billion in market capitalization claiming about 10% of stocks in Consumer Discretionary industry.Arcos Dorados Valuation Ratios as Compared to Competition
Comparative valuation techniques use various fundamental indicators to help in determining Arcos Dorados's current stock value. Our valuation model uses many indicators to compare Arcos Dorados value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Arcos Dorados competition to find correlations between indicators driving Arcos Dorados's intrinsic value. More Info.Arcos Dorados Holdings is rated below average in price to earning category among related companies. It is rated fourth in price to book category among related companies fabricating about 0.46 of Price To Book per Price To Earning. The ratio of Price To Earning to Price To Book for Arcos Dorados Holdings is roughly 2.20 . As of the 17th of April 2024, Price To Book Ratio is likely to drop to 5.46. Comparative valuation analysis is a catch-all model that can be used if you cannot value Arcos Dorados by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Arcos Dorados' Stock. Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Arcos Dorados' earnings, one of the primary drivers of an investment's value.Please note that valuation analysis is one of the essential comprehensive assessments in business. It evaluates Arcos Dorados' worth, which you can determine by considering its current assets, liabilities and future cash flows. The investors' valuation analysis is an important metric that will give you a perspective on different companies. It helps you know the worth of the potential investment in Arcos Dorados and how it compares across the competition.
About Arcos Dorados Valuation
The stock valuation mechanism determines the current worth of Arcos Dorados Holdings on a weekly basis. We use both absolute as well as relative valuation methodologies to arrive at the intrinsic value of Arcos Dorados Holdings. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Arcos Dorados Holdings based exclusively on its fundamental and basic technical indicators. By analyzing Arcos Dorados's financials, quarterly and monthly indicators, and its related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Arcos Dorados's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Arcos Dorados. We calculate exposure to Arcos Dorados's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Arcos Dorados's related companies.| Last Reported | Projected for Next Year | ||
| Gross Profit | 583 M | 641.1 M | |
| Pretax Profit Margin | 0.07 | 0.08 | |
| Operating Profit Margin | 0.05 | 0.05 | |
| Net Profit Margin | 0.04 | 0.05 | |
| Gross Profit Margin | 0.65 | 0.68 |
Arcos Dorados Quarterly Retained Earnings |
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8 Steps to conduct Arcos Dorados' Valuation Analysis
Company's valuation is the process of determining the worth of any company in monetary terms. It estimates Arcos Dorados' potential worth based on factors such as financial performance, market conditions, growth prospects, and overall economic environment. The result of company valuation is a single number representing a Company's current market value. This value can be used as a benchmark for various financial transactions such as mergers and acquisitions, initial public offerings (IPOs), or private equity investments. To conduct Arcos Dorados' valuation analysis, follow these 8 steps:- Gather financial information: Obtain Arcos Dorados' financial statements, including balance sheets, income statements, and cash flow statements.
- Determine Arcos Dorados' revenue streams: Identify Arcos Dorados' primary sources of revenue, including products or services offered, target markets, and pricing strategies.
- Analyze market data: Research Arcos Dorados' industry and market trends, including the size of the market, growth rate, and competition.
- Establish Arcos Dorados' growth potential: Evaluate Arcos Dorados' management, business model, and growth potential.
- Determine Arcos Dorados' financial performance: Analyze its financial statements to assess its historical performance and future potential.
- Choose a valuation method: Consider the Company's specific circumstances and choose an appropriate valuation method, such as the discounted cash flow (DCF) or comparable analysis method.
- Calculate the value: Apply the chosen valuation method to the financial information and market data to calculate Arcos Dorados' estimated value.
- Review and adjust: Review the results and make necessary adjustments, considering any relevant factors that may have been missed or overlooked.
A single share of Arcos Dorados represents a small ownership stake in the entity. As a stockholder of Arcos, your percentage of company ownership is determined by dividing the number of shares you own by the total number of shares outstanding and then multiplying that amount by 100. Owning stock in a company generally confers both corporate voting rights and income from any dividends paid to the stock owner.
Arcos Dorados Dividends Analysis For Valuation
As of the 17th of April 2024, Dividends Paid is likely to drop to about 22 M. In addition to that, Dividend Yield is likely to drop to 0.02. At this time, Arcos Dorados' Earnings Yield is very stable compared to the past year. As of the 17th of April 2024, Price Earnings Ratio is likely to grow to 24.94, while Retained Earnings are likely to drop about 365 M.
| Last Reported | Projected for Next Year | ||
| Dividends Paid | 37.9 M | 22 M | |
| Dividend Yield | 0.02 | 0.02 | |
| Dividend Payout Ratio | 0.26 | 0.21 | |
| Dividend Paid And Capex Coverage Ratio | (2.14) | (2.25) |
There are various types of dividends Arcos Dorados can pay to its shareholders, and the actual value of the dividend is determined on a per-share basis. It is to be paid equally to all of Arcos shareholders on a specific date, known as the payable date. The cash dividend is the most common type of dividend payment - it is the payment of actual cash from Arcos Dorados Holdings directly to its shareholders. There are other types of dividends that companies can issue, such as stock dividends or asset dividends. When Arcos pays a dividend, it has no impact on its enterprise value. It does, however, lowers the Equity Value of Arcos Dorados by the value of the dividends paid out.
Arcos Dorados Growth Indicators
Growth stocks usually refer to those companies expected to grow sales and earnings faster than the market average. Growth stocks typically don't pay dividends, often look expensive, and usually trading at a high P/E ratio. Nevertheless, such valuations could be relatively cheap if the company continues to grow, which will drive the share price up. However, since most investors are paying a high price for a growth stock, based on expectations, if those expectations are not fully realized, growth stocks can see dramatic declines. Note, investing in growth stocks can be very risky. If the company such as Arcos Dorados does not do well, investors take a loss on the stock when it is time to sell. Also, because growth stocks typically do not pay dividends, the only opportunity an investor has to make money on their investment is when they eventually sell their shares.
| Common Stock Shares Outstanding | 210.6 M | |
| Quarterly Earnings Growth Y O Y | 0.005 | |
| Forward Price Earnings | 14.5138 |
Arcos Dorados Current Valuation Indicators
Valuation refers to the process of determining the present value of Arcos Dorados Holdings and all of its assets. It can be calculated using a number of techniques. As many analysts who try to value Arcos we look at many different elements of the entity such as Arcos's management, its prospective future earnings, the current market value of the company's assets, as well as its capital structure formation. Arcos Dorados' valuation analysis is also a process of estimating the intrinsic value of all assets and outstanding equities. There are different methodologies and models we use to develop the final Arcos Dorados' valuation. The techniques such as discounted cash flow and fundamental indicators such as book value per share or market capitalization are well known and widely used across most financial advisers and money managers.
Valuations are an essential part of business, for companies themselves, but also for investors. For companies, such as Arcos Dorados, valuations can help measure their progress and success and can help them track their performance in the market compared to others. In addition, investors can use Arcos Dorados' valuations to help determine the worth of potential investments. They can do this by using data and information made public by a company. Regardless of who the valuation is for, it essentially describes Arcos Dorados' worth.When determining whether Arcos Dorados Holdings offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Arcos Dorados' financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Arcos Dorados Holdings Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Arcos Dorados Holdings Stock: Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Arcos Dorados Holdings. Also, note that the market value of any company could be tightly coupled with the direction of predictive economic indicators such as signals in main economic indicators. 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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.
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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 0.005 | Dividend Share 0.19 | Earnings Share 0.86 | Revenue Per Share 20.566 | Quarterly Revenue Growth 0.154 |
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.