Arcos Dorados (NYSE:ARCO) Shares Down 6.5% – Here’s Why

Shares of Arcos Dorados Holdings Inc. (NYSE:ARCO) dropped 6.5% on Thursday. The company traded as low as $6.71 and last traded at $6.6850. 1,684,212 shares traded hands during trading, an increase of 31% from the average daily volume of 1,286,034 shares. The stock had previously closed at $7.15.

Wall Street Analyst Weigh In

A number of research firms have recently issued reports on ARCO. JPMorgan Chase & Co. raised Arcos Dorados from a “neutral” rating to an “overweight” rating and boosted their target price for the company from $9.00 to $10.50 in a report on Friday, July 17th. Weiss Ratings downgraded shares of Arcos Dorados from a “hold (c)” rating to a “hold (c-)” rating in a report on Monday, September 14th. Finally, Zacks Research downgraded Arcos Dorados from a “strong-buy” rating to a “hold” rating in a research report on Monday, August 10th. Three investment analysts have rated the stock with a Buy rating and two have issued a Hold rating to the stock. According to MarketBeat.com, the company currently has an average rating of “Moderate Buy” and an average price target of $10.50.

Arcos Dorados Stock Down 5.2%

The company has a market capitalization of $1.43 billion, a price-to-earnings ratio of 5.57 and a beta of 0.49. The company has a quick ratio of 0.81, a current ratio of 0.88 and a debt-to-equity ratio of 1.14. The firm has a 50 day moving average price of $7.94 and a two-hundred day moving average price of $8.28.

Arcos Dorados (NYSE:ARCO) last issued its earnings results on Friday, August 14th. The restaurant operator reported $0.22 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.15 by $0.07. Arcos Dorados had a net margin of 5.15% and a return on equity of 12.50%. The business had revenue of $1.31 billion for the quarter, compared to analyst estimates of $1.28 billion. As a group, sell-side analysts expect that Arcos Dorados Holdings Inc. will post 0.79 earnings per share for the current year.

Institutional Trading of Arcos Dorados

Several hedge funds and other institutional investors have recently modified their holdings of ARCO. Public Employees Retirement System of Ohio acquired a new position in shares of Arcos Dorados in the second quarter worth $31,000. FNY Investment Advisers LLC bought a new stake in Arcos Dorados during the 2nd quarter valued at approximately $40,000. Squarepoint Ops LLC bought a new position in Arcos Dorados during the second quarter valued at about $81,000. Baird Financial Group Inc. bought a new position in shares of Arcos Dorados during the 2nd quarter worth about $87,000. Finally, DGS Capital Management LLC lifted its stake in Arcos Dorados by 10.6% during the fourth quarter. DGS Capital Management LLC now owns 13,481 shares of the restaurant operator’s stock worth $99,000 after purchasing an additional 1,290 shares during the period. Institutional investors and hedge funds own 55.91% of the company’s stock.

About Arcos Dorados

Arcos Dorados Holdings Inc is the largest independent McDonald’s franchisee in the world and operates McDonald’s restaurants across Latin America and the Caribbean. The company holds the exclusive right to own, operate and franchise McDonald’s restaurants in numerous markets throughout the region.

Its restaurants offer McDonald’s core menu of hamburgers, cheeseburgers, chicken products, french fries, breakfast items, beverages and desserts, along with regionally adapted products. Arcos Dorados also serves customers through drive-thru locations, delivery, mobile ordering and other digital channels.

Arcos Dorados was established in 2007 following the acquisition of McDonald’s operations in Latin America from McDonald’s Corporation.