ARCO Stock Analysis: Buy, Sell, or Hold?
ARCO - ARCOS DORADOS HOLDINGS INC.
$8.18
0.25 (3.15%)
▲
5d:
+1.11%
30d:
-7.36%
90d:
+11.6%
BUY
HIGH Confidence
Analysis Updated: Mar 31, 2026 12:00 AM ET
Earnings: May 13, 2026
Get Alerted When ARCO Hits Your Target Price
Join 10,000+ traders who never miss a move
You're in! Check your email to confirm and set your target price.
100% Free
No spam, ever
Unsubscribe anytime
Interactive Price Chart (1 Month)
Loading chart...
Loading historical data...
Bottom Line:
✅ BUY SIGNAL: ARCO trading at deep discount. Market pricing in -4.3% annual earnings decline, creating value opportunity for patient investors.
✅ BUY SIGNAL: ARCO trading at deep discount. Market pricing in -4.3% annual earnings decline, creating value opportunity for patient investors.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$14.19
Based on 9.5% avg growth
INTRINSIC VALUE TODAY
$8.81
7.1% Margin of Safety
How this is calculated: We use a Growth Decay Model: starting with analyst consensus growth (adjusted above) and gradually slowing it down to a long-term terminal rate (4%) by Year 5. This provides a more realistic valuation than assuming constant hyper-growth. We then apply a 11.5x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: ARCO is currently trading at $8.18, which is considered fair relative to its 30-day fair value range of $7.79 to $8.61. From a valuation perspective, the stock is trading at a discount (Forward PE: 10.1) compared to its historical average (11.5). Remarkably, the market is currently pricing in an annual earnings decline of 4.3% over the next few years. This aligns with recent fundamental challenges.
Technical Outlook: Technically, ARCO is in a strong uptrend. Immediate support is located at $7.48, while resistance sits at $8.44. The stock is showing strong short-term momentum, up 3.2% recently.
Market Sentiment: ARCO has a strong technical setup (60/100), with favorable trendlines, momentum, and price action for short-term traders. In the options market, Implied Volatility is low (28th percentile), suggesting options premiums are relatively cheap. This makes it an attractive time for long options strategies if you have a directional bias. Wall Street analysts see significant upside, with an average price target of $9.91 (+25.0%). Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Technical Outlook: Technically, ARCO is in a strong uptrend. Immediate support is located at $7.48, while resistance sits at $8.44. The stock is showing strong short-term momentum, up 3.2% recently.
Market Sentiment: ARCO has a strong technical setup (60/100), with favorable trendlines, momentum, and price action for short-term traders. In the options market, Implied Volatility is low (28th percentile), suggesting options premiums are relatively cheap. This makes it an attractive time for long options strategies if you have a directional bias. Wall Street analysts see significant upside, with an average price target of $9.91 (+25.0%). Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Quick Decision Summary
Current Position
FAIR
Fair Price Range
$7.79 -
$8.61
Company Quality Score
57/100
(HOLD)
Options IV Signal
28th percentile
(COMPLACENCY WARNING)
Volume Confirmation
HIGH
Confidence Score
90.4%
All Signals
- NEUTRAL: Price in fair range
- BULLISH: Options cheap (IV 28th percentile)
- BULLISH: Strong technical setup (60/100)
- BULLISH: High volume confirmation
- BULLISH: Strong upward momentum (+3.2%)
- BULLISH: Trading 25.0% below Wall St target ($9.91)
Fair Price Analysis
30-Day Fair Range
$7.79 -
$8.61
Current vs Fair Value
FAIR
Expected Move (7 Days)
±$0.41
(5.0%)
Support & Resistance Levels
Support Level
$7.48
Resistance Level
$8.44
Current Trend
Strong Uptrend
Technical data as of
Mar 31, 2026
Fundamental Context
Forward P/E (Next Year Est.)
10.09
Wall Street Target
$9.91
(+25.0%)
Revenue Growth (YoY)
10.7%
Earnings Growth (YoY)
-56.9%
Profit Margin
4.5%
Valuation Discount vs History
-4.3% cheaper
PE vs Historical
10.1 vs 11.5
CHEAP
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
-4.3%
(market-implied from PE analysis)
1-Year Target
$7.59
(-4%)
2-Year Target
$7.26
(-8%)
3-Year Target
$6.95
(-12%)
3-Yr Target (if PE normalizes)
(PE: 10→12)
$7.92
(0%)
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 22.4, Growth: 15.0%)
$26.74
(+237%)
Base:
(SPY PE: 10.1, Growth: 15.0%)
$12.07
(+52%)
Bear:
(PE: 8.6, Growth: 15.0%)
$10.26
(+29%)
📈
Valuation based on Current Earnings
Trailing PE: 6.56 | Current EPS (TTM): $1.17
Bull Case
$5.68
(-29%)
Analyst growth -32.8%, PE expands to 7.2
Base Case
$5.16
(-36%)
Market implied -32.8%, PE stable at 6.6
Bear Case
$5.22
(-35%)
Severe decline -20.0%, PE contracts to 5.6
These are projections based on PE multiples and EPS growth scenarios, not predictions. Actual results may vary significantly.
💡
Upside Surprise Potential
If earnings stabilize (0% growth), PE could expand from 10.1 to 11.5
Stabilization Target:
$9.04
(+14.0%)
PE Expansion Potential:
+14.0%
Share & Embed Analysis
Last updated: March 31, 2026 1:52 PM ET
Data refreshes hourly during market hours. Next update: 2:52 PM
Data refreshes hourly during market hours. Next update: 2:52 PM
🔥 Top Stocks Breaking Out Now
| Ticker | Score | Recommendation | Change % |
|---|
Technical Signals Check
Is ARCO showing a specific setup today?
Insider Activity (6 Months)
0
Buys
0
Sells
0
Net
NEUTRAL
Featured in Portfolios
ARCO is a key holding in these high-performance investment strategies.
Top Rated Restaurants Stocks
Top-rated stocks in Restaurants by analyst ratings.
| Stock | Analyst Consensus | Analyst Target | Tradestie Score |
|---|---|---|---|
|
QSR
Restaurant Brands Intern… |
BUY
31 analysts |
$80 | 55 HOLD |
|
CMG
Chipotle Mexican Grill I… |
STRONG BUY
34 analysts |
$45 | 52 HOLD |
|
DPZ
Domino's Pizza Inc Commo… |
BUY
31 analysts |
$479 | 57 HOLD |
|
DRI
Darden Restaurants Inc |
BUY
31 analysts |
$225 | 57 HOLD |
|
MCD
McDonald’s Corporation |
BUY
36 analysts |
$343 | 56 HOLD |
