Arcos Dorados (ARCO) Stock Sinks As Market Gains: What You Should Know
In the latest trading session, Arcos Dorados (ARCO) closed at $11.98, marking a -0.08% move from the previous day. This change lagged the S&P 500's 0.96% gain on the day. Meanwhile, the Dow gained 0.4%, and the Nasdaq, a tech-heavy index, added 1.3%.
Prior to today's trading, shares of the restaurant owner had gained 0.76% over the past month. This has lagged the Retail-Wholesale sector's gain of 4.23% and the S&P 500's gain of 3.69% in that time.
Market participants will be closely following the financial results of Arcos Dorados in its upcoming release. The company is expected to report EPS of $0.25, down 3.85% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.16 billion, up 14.4% from the prior-year quarter.
It's also important for investors to be aware of any recent modifications to analyst estimates for Arcos Dorados. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Arcos Dorados is holding a Zacks Rank of #3 (Hold) right now.
In terms of valuation, Arcos Dorados is currently trading at a Forward P/E ratio of 12.66. This denotes a discount relative to the industry's average Forward P/E of 20.75.
Also, we should mention that ARCO has a PEG ratio of 1. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Restaurants was holding an average PEG ratio of 1.97 at yesterday's closing price.
The Retail - Restaurants industry is part of the Retail-Wholesale sector. Currently, this industry holds a Zacks Industry Rank of 147, positioning it in the bottom 42% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Arcos Dorados Holdings Inc. (ARCO) : Free Stock Analysis Report
