Latest news with #ArcosDorados
Yahoo
5 days ago
- Business
- Yahoo
Arcos Dorados (ARCO) Stock Trades Up, Here Is Why
What Happened? Shares of fast-food chain Arcos Dorados (NYSE:ARCO) jumped 7.4% in the morning session after the company reported mixed second-quarter results that saw profits beat expectations but revenue fall short. The master franchisee for McDonald's in Latin America and the Caribbean posted earnings of $0.11 per share, easily surpassing analyst estimates of $0.08. However, total revenue of $1.14 billion missed Wall Street's expectations, growing just 2.8% year-over-year. While same-store sales, which track performance at restaurants open for at least a year, grew a solid 12.1%, this represented a significant slowdown from previous periods. The company's operating margin also declined to 5.5% from 6.7% in the same quarter last year. Investors appeared to weigh the strong profit beat against the revenue miss and decelerating growth, leading to a muted reaction for the stock. Is now the time to buy Arcos Dorados? Access our full analysis report here, it's free. What Is The Market Telling Us Arcos Dorados's shares are not very volatile and have only had 7 moves greater than 5% over the last year. In that context, today's move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business. The previous big move we wrote about was about 23 hours ago when the stock gained 4.2% as investors cheered a government report showing that inflation remained steady in July. The steady inflation figures have fueled expectations that the Federal Reserve may soon consider an interest rate cut to stimulate the economy, a move that would likely benefit consumer discretionary spending, including dining out. The July Consumer Price Index (CPI) rose 2.7% from a year earlier, meeting the previous month's pace and coming in slightly below economists' expectations of a 2.8% increase. On a monthly basis, the CPI rose 0.2%, a slowdown from the 0.3% increase seen in June. While the cost of dining out continued to climb, rising 0.3% in July, this was offset by a 0.1% dip in grocery prices, contributing to the overall stable inflation picture. The market's positive reaction sent major stock indexes, including the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite, soaring. This optimism spilled over into the restaurant sector, which has been grappling with a challenging macroeconomic environment marked by high costs and concerns over consumer traffic. Arcos Dorados is up 0.7% since the beginning of the year, but at $7.56 per share, it is still trading 25.2% below its 52-week high of $10.10 from August 2024. Investors who bought $1,000 worth of Arcos Dorados's shares 5 years ago would now be looking at an investment worth $1,583. Unless you've been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story.
Yahoo
5 days ago
- Business
- Yahoo
McDonald's Franchisee Arcos Dorados Sees Growth Driven By Digital Sales Despite Brazil Margin Pressures
Arcos Dorados Holdings Inc. (NYSE:ARCO) shares are trading higher on Wednesday. The company reported second-quarter earnings per share of 11 cents, beating the analyst consensus estimate of 7 cents. Quarterly sales of $1.142 billion (+2.8% year over year) outpaced the Street view of $1.137 billion. Revenues grew 14.9% at constant Dorados Holdings is the master franchise of the fast food restaurant chain McDonald's (NYSE:MCD) in 20 countries and territories across Latin America and the Caribbean. Systemwide comparable sales rose 12.1% year-over-year, while digital channel sales grew 7.9%, accounting for over 60% of total sales in the quarter. View more earnings on ARCO Adjusted EBITDA in the quarter under review declined to $110.111 million, compared with $118.782 million in the year-ago period, mainly due to margin pressure in Brazil from higher beef costs this year. Adjusted EBITDA Margin contracted to 9.6% from 10.7%. The company exited the quarter with cash and equivalents worth $147.052 million, higher than $135.064 million as of December 31, 2024. The company opened 20 Experience of the Future (EOTF) restaurants in the quarter. By the end of the second quarter, the company's Loyalty Program was active in 67% of all restaurants in its footprint. Price Action: ARCO shares are trading higher by 8.63% to $7.550 at last check Wednesday. Read Next:Image via Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? ARCOS DORADOS HOLDINGS (ARCO): Free Stock Analysis Report This article McDonald's Franchisee Arcos Dorados Sees Growth Driven By Digital Sales Despite Brazil Margin Pressures originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved.
Business Wire
6 days ago
- Business
- Business Wire
Arcos Dorados Reports Second Quarter 2025 Financial Results
MONTEVIDEO, Uruguay--(BUSINESS WIRE)--Arcos Dorados Holdings Inc. (NYSE: ARCO) ('Arcos Dorados' or the 'Company'), Latin America and the Caribbean's largest restaurant chain and the world's largest independent McDonald's franchisee, today reported unaudited results for the three and six months ended June 30, 2025. Message from Luis Raganato, Chief Executive Officer The results we are reporting today demonstrate the strength of the Arcos Dorados business model. Each of our markets faced a unique set of operating conditions and each delivered strong results within the context of their individual environments. By staying true to our Purpose, we strengthened our bond with guests and expanded our brand preference throughout Latin America and the Caribbean, Making Every Day an Opportunity to Feed People and Build Dreams. Brazil remained resilient despite challenging consumer dynamics, NOLAD showed that the first quarter calendar effects were only temporary and SLAD continued the strong positive trajectory that began at the end of last year. Combined, the three divisions drove local currency revenue almost 15% higher versus the prior year quarter. Systemwide comparable sales growth was particularly strong in NOLAD and SLAD, rising 1.8x and 1.4x blended inflation, respectively. Market share saw robust gains across the region according to our research, thanks to marketing and digital initiatives focused on value and Brand strength, together with an ever-growing Loyalty Program that is successfully increasing guest visit frequency. The Big Fest digital campaign, Minecraft Happy Meal (for both kids and adults) and the limited-time Formula One promotion all helped strengthen the brand attributes that keep guests coming back to our restaurants. The diversified nature of our business model also drove strong profitability in the quarter, despite important cost pressures in some markets. Consolidated Adjusted EBITDA declined as reported, but was up 7.1% in US dollars with a 40 basis point margin expansion, when we adjust last year's result for a reduction of labor contingencies due to a favorable judgement in Brazil. Finally, our growth plan remains intact, and we opened 20 new EOTF restaurants in the period. This year's growth trajectory also includes the addition of our 21 st market: Saint Martin. We believe the choice of Arcos Dorados as the new operator in Saint Martin is a testament to our operational excellence and commitment to growth in the region. We remain convinced there is compelling growth potential for our business and our shareholders for many years to come. AD Holdings Inc. – Consolidated Key Financial Results Arcos Dorados' total revenues reached $1.1 billion, up 2.8% in US dollars versus the prior year quarter. The Company's comparable systemwide sales rose 12.1% in the quarter, driven by strong sales in NOLAD and SLAD, which grew 1.8x and 1.4x blended inflation, respectively. The consumer environment remained challenging in Brazil during the second quarter of 2025. The Company's Digital strategy continued to support sales growth. Digital channel sales rose 7.9% in the period, generating more than 60% of the second quarter's systemwide sales. By the end of the second quarter of 2025, the Company's Loyalty Program was active in 67% of all restaurants in its footprint. The Program remains on target to be available in all main markets by year-end 2025. Offered in Argentina, Brazil, Colombia, Costa Rica, Ecuador and Uruguay, the Loyalty Program reached 21.5 million registered members at the end of the second quarter and was responsible for 22.6% of total sales in these markets. The Company's digital channels supported campaigns designed to strengthen the bond with guests and adapt to changing consumer preferences. This included the Big Fest, which celebrated core favorites at a compelling value, resulting in increased Brand Preference, improved Brand Attributes and strong growth in both Mobile App downloads and Loyalty Program membership. In Brazil, the successful 'Méqui do Dia' campaign, offered one menu favorite per day at a compelling value, while the Minecraft Happy Meal enjoyed crossover appeal to both kids and adults throughout the region, which was optimized by offering a unique adult Happy Meal with chicken McNuggets. Arcos Dorados' regional Formula 1 sponsorship also served to strengthen ties with families and guests of all ages. Capitalizing on the popularity of Formula 1, The Movie, the Company introduced a limited-edition sandwich and collectible race cars, exclusive to McDonald's restaurants. The campaign was extremely successful, selling out in just a matter of days or weeks, in each market. Finally, given the increasingly competitive nature of the dessert category, the Company remained committed to keeping its menu at an affordable price and brought innovation to its dessert platform by leveraging a favorite McDonald's character with the Grimace Shake and by adding more local flavors to its McFlurry offerings. Adjusted EBITDA declined in US dollars mainly due to margin pressure in Brazil from higher beef costs this year and a reduction of labor contingencies in the prior year. Excluding the reduction of labor contingencies, consolidated Adjusted EBITDA rose 7.1% and Adjusted EBITDA margin expanded by 40 basis points versus the prior year period. Efficiencies in Payroll (excluding the labor contingency reduction in Brazil from the 2Q24) and Occupancy and other operating expenses, mainly in Brazil and SLAD, were offset by the abovementioned Food & Paper cost pressures. Net income attributable to the Company totaled $22.6 million in the second quarter of 2025, which represented a net income margin of 2.0%. The decrease in comparison with the prior year quarter was mainly explained by a lower reported Adjusted EBITDA margin and reduced non-cash foreign exchange results. Arcos Dorados recorded earnings of $0.11 per share in the second quarter of 2025 compared to $0.13 per share in the prior year period. Total weighted average shares amounted to 210,663,057 in the second quarter compared to 210,660,444 in the prior year's quarter. Notable items in the Adjusted EBITDA reconciliation Included in Adjusted EBITDA: Brazil's result in the second quarter of 2024 included a $16.0 million positive impact from the reduction of labor contingencies due to a favorable judgement. Additionally, Adjusted EBITDA in the second quarter of 2025 included a $6.9 million gain in Mexico and the second quarter of 2024 included a $4.2 million gain in Chile, both related to restaurant transactions with sub-franchisees in those markets. Excluded from Adjusted EBITDA: there were no notable items excluded from Adjusted EBITDA in either the second quarter of 2025 or the second quarter of 2024. New Unit Development: Total and by Format 1 Figure 3 as of Jun.30, 2025 Store Format* Total Restaurants Ownership McCafes Dessert Centers FS IS MS & FC Company Operated Franchised Brazil 641 91 459 1,191 734 457 160 2,021 NOLAD 416 47 195 658 512 146 19 520 SLAD 267 124 217 608 509 99 227 740 TOTAL 1,324 262 871 2,457 1,755 702 406 3,281 *FS: Freestanding; IS: In-Store; MS: Mall Store; FC: Food Court. Expand Arcos Dorados added 20 new EOTF restaurants to the Company's footprint, including 18 free-standing units, in the second quarter of 2025. As of the end of June 2025, there were 1,732 EOTF restaurants in Arcos Dorados' footprint, making up 70% of its restaurant portfolio. Consolidated Debt and Financial Ratios (i) Total cash & cash equivalents include short-term investment. (ii) Total financial debt includes short-term debt, long-term debt and derivative instruments (including the asset portion of derivatives amounting to $68.0 million and $80.3 million as a reduction of financial debt as of June 30, 2025 and December 31, 2024, respectively). (iii) Net financial debt equals total financial debt less total cash & cash equivalents. Expand The Company's net debt to Adjusted EBITDA leverage ratio ended the second quarter at a comfortable 1.4x, up from 1.1x at year-end 2024. For the six-month period ended June 30, 2025, the net cash provided by operating activities totaled $57.7 million with total property and equipment expenditures of $104.2 million. This compares with net cash provided by operating activities in the same period of the prior year of $63.7 million and total property and equipment expenditures of $148.9 million. Recent Developments Appointment of Luis Raganato as Chief Executive Officer (CEO) On June 6, 2025, Arcos Dorados' Board of Directors announced the appointment of Luis Raganato as CEO, effective July 1, 2025. He succeeded Marcelo Rabach who served as CEO from July 2019 to June 2025. Prior to his promotion, Mr. Raganato was Arcos Dorados' Chief Operating Officer. Appointment of Carlos Gonzalez as Chief Operating Officer (COO) On June 6, 2025, Arcos Dorados' Board of Directors also announced the appointment of Mr. Carlos Gonzalez, as COO, to succeed Mr. Raganato, effective July 1, 2025. Prior to his appointment, Mr. Gonzalez was Divisional President for the South Latin American Division. Appointment of Francisco Staton as Chief Strategy Officer (CSO) In July 2025, Mr. Francisco Staton assumed a new management role as Chief Strategy Officer for Arcos Dorados, reporting directly to Mr. Raganato. Mr. Staton is a member of the Company's Board of Directors and previously held several senior leadership positions within the Company. Acquisition of Saint Martin In July 2025, the Company acquired 3 restaurants and the exclusive rights to operate or sub-franchise McDonald's restaurants in Saint Martin, making it the twenty-first territory in the Company's footprint. This new territory will be managed by the North Latin American Division. S&P Global Rating Action In July 2025, S&P Global Ratings assigned a long-term issuer credit rating of 'BBB-' with a Stable Outlook to the Company. This marks the Company's second investment grade rating, following Fitch Ratings' upgrade to 'BBB-' in January 2025, thereby achieving full investment grade status. 2024 Social Impact and Sustainable Development Report In July 2025, Arcos Dorados published its Social Impact and Sustainable Development Report for 2024. The report includes information audited by EY and provides an update on the progress related to initiatives and implementation of the six pillars of the Company's 'Recipe for the Future' ESG Platform. The full report can be downloaded at Second Quarter 2025 Earnings Webcast A webcast to discuss the information contained in this press release will be held today, August 13, 2025, at 10:00 a.m. ET. In order to access the webcast, members of the investment community should follow this link: Arcos Dorados Second Quarter 2025 Earnings Webcast. A replay of the webcast will be available later today in the investor section of the Company's website: Definitions In analyzing business trends, management considers a variety of performance and financial measures which are considered to be non-GAAP including: Adjusted EBITDA, Constant Currency basis, Systemwide sales, and Systemwide comparable sales growth. Adjusted EBITDA: In addition to financial measures prepared in accordance with the general accepted accounting principles (GAAP), this press release and the accompanying tables use a non-GAAP financial measure titled 'Adjusted EBITDA'. Management uses Adjusted EBITDA to facilitate operating performance comparisons from period to period. Adjusted EBITDA is defined as the Company's operating income plus depreciation and amortization plus/minus the following losses/gains: gains from sale or insurance recovery of property and equipment, write-offs of long-lived assets, and impairment of long-lived assets. Management believes Adjusted EBITDA facilitates company-to-company operating performance comparisons by backing out potential differences caused by variations such as capital structures (affecting net interest expense and other financing results), taxation (affecting income tax expense) and the age and book depreciation of facilities and equipment (affecting relative depreciation expense), which may vary for different companies for reasons unrelated to operating performance. Figure 5 of this earnings release includes a reconciliation for Adjusted EBITDA. For more information, please see Adjusted EBITDA reconciliation in Note 9 – Segment and geographic information – of our financial statements (6-K Form) filed today with the S.E.C. Constant Currency basis: refers to amounts calculated using the same exchange rate over the periods under comparison to remove the effects of currency fluctuations from this trend analysis. To better discern underlying business trends, this release uses non-GAAP financial measures that segregate year-over-year growth into two categories: (i) currency translation and (ii) constant currency growth. (i) Currency translation reflects the impact on growth of the appreciation or depreciation of the local currencies in which the Company conducts its business against the US dollar (the currency in which the Company's financial statements are prepared). (ii) Constant currency growth reflects the underlying growth of the business excluding the effect from currency translation. The Company also calculates variations as a percentage in constant currency, which are also considered to be non-GAAP measures, to provide a more meaningful analysis of its business by identifying the underlying business trends, without distortion from the effect of foreign currency fluctuations. Systemwide sales: Systemwide sales represent measures for both Company-operated and sub-franchised restaurants. While sales by sub-franchisees are not recorded as revenues by the Company, management believes the information is important in understanding its financial performance because these sales are the basis on which it calculates and records sub-franchised restaurant revenues and are indicative of the financial health of its sub-franchisee base. Systemwide comparable sales growth: this non-GAAP measure, refers to the change, on a constant currency basis, in Company-operated and sub-franchised restaurant sales in one period from a comparable period for restaurants that have been open for thirteen months or longer (year-over-year basis) including those temporarily closed. Management believes it is a key performance indicator used within the retail industry and is indicative of the success of the Company's initiatives as well as local economic, competitive and consumer trends. Sales by sub-franchisees are not recorded as revenues by the Company. About Arcos Dorados Arcos Dorados is the world's largest independent McDonald's franchisee, operating the largest quick service restaurant chain in Latin America and the Caribbean. It has the exclusive right to own, operate and grant franchises of McDonald's restaurants in 21 Latin American and Caribbean countries and territories with more than 2,400 restaurants, operated by the Company or by its sub-franchisees, that together employ more than 100 thousand people (as of 06/30/2025). The Company is also committed to the development of the communities in which it operates, to providing young people their first formal job opportunities and to utilize its Recipe for the Future to achieve a positive environmental impact. Arcos Dorados is listed for trading on the New York Stock Exchange (NYSE: ARCO). To learn more about the Company, please visit the Investors section of our website: Cautionary Statement on Forward-Looking Statements This press release contains forward-looking statements. The forward-looking statements contained herein include statements about the Company's business prospects, its ability to attract customers, its expectation for revenue generation and its outlook and guidance for 2025. These statements are subject to the general risks inherent in Arcos Dorados' business. These expectations may or may not be realized. Some of these expectations may be based upon assumptions or judgments that prove to be incorrect. In addition, Arcos Dorados' business and operations involve numerous risks and uncertainties, many of which are beyond the control of Arcos Dorados, which could result in Arcos Dorados' expectations not being realized or otherwise materially affect the financial condition, results of operations and cash flows of Arcos Dorados. Additional information relating to the uncertainties affecting Arcos Dorados' business is contained in its filings with the Securities and Exchange Commission. The forward-looking statements are made only as of the date hereof, and Arcos Dorados does not undertake any obligation to (and expressly disclaims any obligation to) update any forward-looking statements to reflect events or circumstances after the date such statements were made, or to reflect the occurrence of unanticipated events. Second Quarter 2025 Consolidated Results Second Quarter 2025 Results by Division and Average Exchange Rates per Quarter Figure 6 (In thousands of U.S. dollars) For Three-Months ended as Constant For Six-Months ended as Constant June 30, reported Currency June 30, reported Currency 2025 2024 Incr/(Decr)% Incr/(Decr)% 2025 2024 Incr/(Decr)% Incr/(Decr)% Revenues Brazil 415,387 441,990 -6.0% 2.0% 815,689 890,927 -8.4% 3.7% NOLAD 317,829 310,205 2.5% 6.9% 599,529 612,926 -2.2% 3.3% SLAD 409,080 358,706 14.0% 37.8% 803,670 688,404 16.7% 38.4% TOTAL 1,142,296 1,110,901 2.8% 14.9% 2,218,888 2,192,257 1.2% 14.5% Operating Income (loss) Brazil 34,118 68,194 -50.0% -45.9% 67,096 125,236 -46.4% -39.3% NOLAD 27,569 13,191 109.0% 117.6% 40,428 31,174 29.7% 34.1% SLAD 27,354 19,719 38.7% 71.1% 52,423 34,161 53.5% 82.2% Corporate and Other (26,581) (26,885) 1.1% -10.7% (52,340) (48,801) -7.3% -19.7% TOTAL 62,460 74,219 -15.8% -6.2% 107,607 141,770 -24.1% -14.2% Adjusted EBITDA Brazil 52,954 86,168 -38.5% -33.4% 102,523 161,614 -36.6% -28.2% NOLAD 41,238 26,161 57.6% 64.4% 67,478 54,763 23.2% 28.9% SLAD 40,533 30,571 32.6% 59.9% 79,593 55,312 43.9% 68.8% Corporate and Other (24,614) (24,118) -2.1% -14.6% (48,204) (43,972) -9.6% -22.8% TOTAL 110,111 118,782 -7.3% 2.4% 201,390 227,717 -11.6% -0.8% Expand Figure 7 Systemwide Comparable Sales For Three-Months ended June 30, 2025 2024 Brazil 0.3% 10.2% NOLAD 4.4% 7.9% SLAD 38.2% 113.4% TOTAL 12.1% 40.8% Expand Figure 8 period average local currency per US$ Brazil Mexico Argentina 2Q25 5.66 19.49 1,150.22 2Q24 5.22 17.26 885.90 Expand Summarized Consolidated Balance Sheet Figure 9 (In thousands of U.S. dollars) June 30, December 31, 2025 2024 ASSETS Current assets Cash and cash equivalents 147,052 135,064 Short-term investments 86,810 3,529 Accounts and notes receivable, net 156,314 119,441 Other current assets (1) 232,003 209,953 Derivative instruments 1,500 416 Total current assets 623,679 468,403 Non-current assets Property and equipment, net 1,238,288 1,127,042 Net intangible assets and goodwill 144,143 66,644 Deferred income taxes 111,215 90,287 Derivative instruments 66,462 79,874 Equity method investments 15,816 14,346 Leases right of use asset 1,053,998 949,977 Other non-current assets (2) 118,819 96,081 2,748,741 2,424,251 Total assets 3,372,420 2,892,654 LIABILITIES AND EQUITY Current liabilities Accounts payable 313,225 347,895 Taxes payable (3) 131,719 118,466 Accrued payroll and other liabilities 149,555 113,259 Royalties payable to McDonald's Corporation 27,208 20,860 Provision for contingencies 1,306 1,199 Interest payable 18,328 7,798 Financial debt (4) 37,456 64,167 Operating lease liabilities 99,784 92,280 Total current liabilities 778,581 765,924 Non-current liabilities Accrued payroll and other liabilities 88,841 20,928 Provision for contingencies 31,934 29,157 Financial debt (5) 945,355 715,974 Deferred income taxes 1,956 2,084 Operating lease liabilities 944,111 849,158 Total non-current liabilities 2,012,197 1,617,301 Total liabilities 2,790,778 2,383,225 Equity Class A shares of common stock 389,967 389,967 Class B shares of common stock 132,915 132,915 Additional paid-in capital 8,659 8,659 Retained earnings 650,347 664,390 Accumulated other comprehensive loss (582,283) (668,484) Common stock in treasury (19,367) (19,367) Total Arcos Dorados Holdings Inc shareholders' equity 580,238 508,080 Non-controlling interest in subsidiaries 1,404 1,349 Total equity 581,642 509,429 Total liabilities and equity 3,372,420 2,892,654 Expand (1) Includes "Other receivables", "Inventories" and "Prepaid expenses and other current assets'. (2) Includes "Miscellaneous" and "Collateral deposits". (3) Includes "Income taxes payable" and "Other taxes payable". (4) Includes "Short-term debt', 'Current portion of long-term debt" and "Derivative instruments'. (5) Includes "Long-term debt, excluding current portion" and "Derivative instruments". Expand
Yahoo
6 days ago
- Business
- Yahoo
Cracker Barrel, Arcos Dorados, BJ's, Denny's, and The ONE Group Shares Are Soaring, What You Need To Know
What Happened? A number of stocks jumped in the morning session after investors cheered a government report showing that inflation remained steady in July. The steady inflation figures have fueled expectations that the Federal Reserve may soon consider an interest rate cut to stimulate the economy, a move that would likely benefit consumer discretionary spending, including dining out. The July Consumer Price Index (CPI) rose 2.7% from a year earlier, meeting the previous month's pace and coming in slightly below economists' expectations of a 2.8% increase. On a monthly basis, the CPI rose 0.2%, a slowdown from the 0.3% increase seen in June. While the cost of dining out continued to climb, rising 0.3% in July, this was offset by a 0.1% dip in grocery prices, contributing to the overall stable inflation picture. The market's positive reaction sent major stock indexes, including the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite, soaring. This optimism spilled over into the restaurant sector, which has been grappling with a challenging macroeconomic environment marked by high costs and concerns over consumer traffic. The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Among others, the following stocks were impacted: Sit-Down Dining company Cracker Barrel (NASDAQ:CBRL) jumped 3.4%. Is now the time to buy Cracker Barrel? Access our full analysis report here, it's free. Traditional Fast Food company Arcos Dorados (NYSE:ARCO) jumped 4.2%. Is now the time to buy Arcos Dorados? Access our full analysis report here, it's free. Sit-Down Dining company BJ's (NASDAQ:BJRI) jumped 3.1%. Is now the time to buy BJ's? Access our full analysis report here, it's free. Sit-Down Dining company Denny's (NASDAQ:DENN) jumped 4.2%. Is now the time to buy Denny's? Access our full analysis report here, it's free. Sit-Down Dining company The ONE Group (NASDAQ:STKS) jumped 3.6%. Is now the time to buy The ONE Group? Access our full analysis report here, it's free. Zooming In On Arcos Dorados (ARCO) Arcos Dorados's shares are not very volatile and have only had 7 moves greater than 5% over the last year. In that context, today's move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business. The biggest move we wrote about over the last year was 3 months ago when the stock dropped 6.1% on the news that the company reported weak first quarter 2025 results: Its same-store sales missed and its revenue fell short of Wall Street's estimates. Same-store sales only kept pace with inflation, as revenue dipped slightly, hurt by softer demand in Brazil and North Latin America. Margins took a hit, too, as costs for food and rent crept higher while growth in spending didn't keep up, which pulled down profits. As a result, earnings fell relative to the previous year, and came in below consensus estimates. The company stayed upbeat in its commentary as it observed some uptick in demand in March. With currency headwinds and tighter wallets across its key markets, it'll have to work harder to win back momentum. Arcos Dorados is down 6.7% since the beginning of the year, and at $7 per share, it is trading 30.7% below its 52-week high of $10.10 from August 2024. Investors who bought $1,000 worth of Arcos Dorados's shares 5 years ago would now be looking at an investment worth $1,488. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
31-07-2025
- Business
- Yahoo
Arcos Dorados Achieves Full Investment Grade With S&P's Initial Rating of 'BBB-'
MONTEVIDEO, Uruguay, July 31, 2025--(BUSINESS WIRE)--Arcos Dorados Holdings Inc. (NYSE: ARCO) ("Arcos Dorados" or the "Company") announced that S&P Global Ratings (S&P) assigned an investment grade long-term issuer credit rating of 'BBB-' with a Stable Outlook for the Company. This marks the second investment grade rating received by Arcos Dorados, following Fitch Ratings' upgrade to 'BBB-' in January 2025, thereby achieving full investment grade status. In its report, the agency highlighted Arcos Dorados' leading position in the quick service restaurant (QSR) industry in Latin America, its exclusive rights to the McDonald's brand through its Master Franchise Agreement (MFA), and its consistent track record of maintaining a conservative financial profile. These strengths support stable credit metrics, with S&P-adjusted debt to EBITDA of approximately 2.0x and S&P-adjusted Funds from Operations to Debt near 35%. S&P also emphasized the strategic benefits of the recently renewed MFA with McDonald's, valid through the end of 2044, with an additional 20-year renewal option. This agreement grants Arcos Dorados exclusive access to one of the world's most recognized brands across 20 countries in the region, providing a significant competitive advantage in terms of brand strength, supply chain integration, and access to global operational know-how. S&P further noted Arcos Dorados' sound liquidity position, broad geographic footprint, and capacity to withstand a potential Brazilian sovereign stress scenario. The Company's prudent financial risk management, lack of near-term debt maturities, and access to committed credit facilities further strengthen its credit profile according to the rating agency. S&P and Fitch both highlighted Arcos Dorados' operating performance and prudent financial policy as key drivers of long-term credit quality. Fitch pointed to the Company's continued strong operating performance, good liquidity and comfortable debt maturity profile to support its upgrade in January 2025. Achieving full investment grade status reinforces Arcos Dorados' commitment to maintaining a solid financial position and enhances its standing in global capital markets, reflecting strong confidence in the Company's financial discipline and long-term strategic execution. Follow us on: LinkedIn, Instagram, X/Twitter, YouTube About Arcos Dorados Arcos Dorados is the world's largest independent McDonald's franchisee, operating in Latin America and the Caribbean. It has the exclusive right to own, operate and grant franchises of McDonald's restaurants in 20 Latin American and Caribbean countries and territories with more than 2,400 restaurants, operated or franchised by the Company or by its sub-franchisees, that together employ more than 100,000 people (as of 03/31/2025). The Company is also committed to the development of the communities in which it operates, to providing young people their first formal job opportunities and to utilize its Recipe for the Future to achieve a positive environmental impact. Arcos Dorados is listed for trading on the New York Stock Exchange (NYSE: ARCO). To learn more about the Company, please visit the Investors section of our website: View source version on Contacts Investor Relations Contact Dan SchleinigerVP of Investor RelationsArcos Media Contact David GrinbergVP of Corporate CommunicationsArcos Sign in to access your portfolio
