Arcos Dorados Holdings Inc. (NYSE:ARCO) is the largest restaurant chain in Latin America and the Caribbean and the world’s largest independent McDonald’s franchisee. The company operates within the Zacks Retail – Restaurants industry. It is known for its strong brand and resilient business model, which have contributed to long-term shareholder value creation.
On March 19, 2026, ARCO reported its earnings before the market opened. The company achieved an earnings per share (EPS) of $0.12, which fell short of the estimated $0.20. This is a significant drop from the $0.28 per share reported in the same quarter last year, as highlighted by Zacks. Despite this, ARCO’s actual revenue was approximately $1.27 billion, slightly surpassing the estimated revenue of around $1.26 billion.
The revenue of $1.27 billion for the quarter ending December 2025 exceeded the Zacks Consensus Estimate by 0.42% and showed an increase from the $1.14 billion in revenues from the previous year. Over the past four quarters, ARCO has consistently surpassed consensus revenue estimates, although it has only exceeded consensus EPS estimates twice. This indicates a strong revenue performance despite challenges in meeting EPS expectations.
ARCO’s financial metrics reveal a mixed picture. The company has a price-to-earnings (P/E) ratio of approximately 6.50, indicating a relatively low valuation compared to its earnings. The price-to-sales ratio stands at 0.35, suggesting that investors are paying $0.35 for every dollar of sales. However, the debt-to-equity ratio is 2.77, indicating a higher level of debt compared to its equity, which could be a concern for investors.
The company’s current ratio is 0.89, which may suggest potential liquidity concerns as it is below 1. Despite these challenges, ARCO’s earnings yield of 15.37% offers a substantial return on investment relative to its share price. The enterprise value to sales ratio is 0.76, reflecting the company’s valuation in relation to its revenue, while the enterprise value to operating cash flow ratio is 12.82, providing insight into the company’s cash flow efficiency.
