Arcos Dorados (NYSE:ARCO) Reaches New 52-Week Low - What's Next?

Key Points

• Arcos Dorados' stock has reached a new 52-week low of $6.66 as analysts predict challenges ahead, with the share price recently trading at $6.67.
• JPMorgan Chase & Co. downgraded Arcos Dorados from an "overweight" to a "neutral" rating and lowered its price target from $10.50 to $8.80.
• Despite a slight revenue increase to $1.08 billion, the company reported a loss per share of $0.07 for the quarter, missing estimates by $0.06.

Arcos Dorados Holdings Inc. (NYSE:ARCO - Get Free Report) shares hit a new 52-week low during trading on Thursday . The stock traded as low as $6.66 and last traded at $6.67, with a volume of 775129 shares traded. The stock had previously closed at $6.84.

Analyst Ratings Changes

Separately, JPMorgan Chase & Co. lowered Arcos Dorados from an "overweight" rating to a "neutral" rating and decreased their price target for the company from $10.50 to $8.80 in a research note on Wednesday, July 2nd.

Arcos Dorados Stock Down 1.5%

The stock has a market cap of $1.38 billion, a price-to-earnings ratio of 10.08 and a beta of 0.63. The company has a quick ratio of 0.81, a current ratio of 0.86 and a debt-to-equity ratio of 1.80. The stock has a fifty day moving average of $7.46 and a two-hundred day moving average of $7.65.

Arcos Dorados (NYSE:ARCO - Get Free Report) last issued its earnings results on Wednesday, May 14th. The restaurant operator reported $0.07 earnings per share for the quarter, missing analysts' consensus estimates of $0.13 by ($0.06). The firm had revenue of $1.08 billion during the quarter, compared to analyst estimates of $1.02 billion. Arcos Dorados had a net margin of 3.00% and a return on equity of 26.70%. Arcos Dorados's revenue was down .4% compared to the same quarter last year. During the same quarter in the previous year, the business posted $0.14 EPS. As a group, analysts predict that Arcos Dorados Holdings Inc. will post 0.63 EPS for the current fiscal year.

Arcos Dorados Cuts Dividend

The business also recently announced a dividend, which was paid on Friday, June 27th. Stockholders of record on Wednesday, June 25th were issued a dividend of $0.06 per share. The ex-dividend date of this dividend was Tuesday, June 24th. This represents a dividend yield of 313.0%. Arcos Dorados's dividend payout ratio is 36.92%.

Hedge Funds Weigh In On Arcos Dorados

Several hedge funds and other institutional investors have recently made changes to their positions in ARCO. Nuveen LLC acquired a new stake in shares of Arcos Dorados during the 1st quarter valued at $79,583,000. Pzena Investment Management LLC acquired a new stake in Arcos Dorados during the 2nd quarter valued at $51,549,000. Price T Rowe Associates Inc. MD raised its stake in Arcos Dorados by 40.1% during the 4th quarter. Price T Rowe Associates Inc. MD now owns 13,463,466 shares of the restaurant operator's stock valued at $98,015,000 after purchasing an additional 3,851,704 shares during the period. Fourth Sail Capital LP acquired a new stake in Arcos Dorados during the 1st quarter valued at $26,746,000. Finally, MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. raised its stake in Arcos Dorados by 96.0% during the 4th quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 3,280,985 shares of the restaurant operator's stock valued at $23,886,000 after purchasing an additional 1,606,821 shares during the period. 55.91% of the stock is currently owned by institutional investors and hedge funds.

About Arcos Dorados

Arcos Dorados Holdings Inc operates as a franchisee of McDonald's restaurants. It has the exclusive right to own, operate, and grant franchises of McDonald's restaurants in 20 countries and territories in Latin America and the Caribbean, including Argentina, Aruba, Brazil, Chile, Colombia, Costa Rica, Curacao, Ecuador, French Guiana, Guadeloupe, Martinique, Mexico, Panama, Peru, Puerto Rico, Trinidad and Tobago, Uruguay, the U.S.