Arcos Dorados (NYSE:ARCO) Shares Gap Up - What's Next?

Key Points

• Price gap: Arcos Dorados' shares gapped up from a $8.96 close to a $9.33 open and last traded near $9.60 on volume of about 306,409 shares.
• Analyst consensus: The consensus rating is "Hold" (2 Buys, 3 Holds) with an average price target of $8.70, despite recent buy/upgrades from Goldman Sachs and Santander.
• Fundamentals & earnings: The company has a $2.03B market cap, a P/E of 9.51 and a $0.07 quarterly dividend (2.9% yield); it missed last-quarter EPS ($0.12 vs. $0.20) while revenue rose 10.7% year-over-year.

Arcos Dorados Holdings Inc. (NYSE:ARCO - Get Free Report)'s stock price gapped up prior to trading on Monday . The stock had previously closed at $8.96, but opened at $9.33. Arcos Dorados shares last traded at $9.6040, with a volume of 306,409 shares.

Analysts Set New Price Targets

A number of research firms have commented on ARCO. The Goldman Sachs Group restated a "buy" rating on shares of Arcos Dorados in a report on Wednesday, April 8th. Weiss Ratings restated a "hold (c-)" rating on shares of Arcos Dorados in a report on Monday, December 29th. Finally, Santander upgraded shares of Arcos Dorados to an "outperform" rating in a report on Monday. Two equities research analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company's stock. According to data from MarketBeat.com, Arcos Dorados currently has a consensus rating of "Hold" and an average price target of $8.70.

Arcos Dorados Price Performance

The stock has a market capitalization of $2.03 billion, a P/E ratio of 9.51, a price-to-earnings-growth ratio of 3.21 and a beta of 0.48. The business's 50 day simple moving average is $8.33 and its two-hundred day simple moving average is $7.73. The company has a quick ratio of 0.95, a current ratio of 1.03 and a debt-to-equity ratio of 1.46.

Arcos Dorados (NYSE:ARCO - Get Free Report) last released its quarterly earnings data on Thursday, March 19th. The restaurant operator reported $0.12 earnings per share for the quarter, missing analysts' consensus estimates of $0.20 by ($0.08). Arcos Dorados had a net margin of 4.53% and a return on equity of 8.12%. The business had revenue of $1.27 billion during the quarter, compared to the consensus estimate of $1.26 billion. During the same period last year, the business posted $0.28 earnings per share. The firm's quarterly revenue was up 10.7% on a year-over-year basis. As a group, sell-side analysts forecast that Arcos Dorados Holdings Inc. will post 0.63 earnings per share for the current fiscal year.

Arcos Dorados Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Tuesday, December 29th. Shareholders of record on Wednesday, December 23rd will be paid a $0.07 dividend. This represents a $0.28 dividend on an annualized basis and a dividend yield of 2.9%. The ex-dividend date of this dividend is Wednesday, December 23rd. Arcos Dorados's dividend payout ratio (DPR) is 23.76%.

Institutional Inflows and Outflows

Large investors have recently made changes to their positions in the company. Emeth Value Capital LLC lifted its position in shares of Arcos Dorados by 29.0% during the third quarter. Emeth Value Capital LLC now owns 1,973,667 shares of the restaurant operator's stock valued at $13,322,000 after purchasing an additional 443,327 shares in the last quarter. Seafarer Capital Partners LLC lifted its position in shares of Arcos Dorados by 53.8% during the third quarter. Seafarer Capital Partners LLC now owns 400,000 shares of the restaurant operator's stock valued at $2,700,000 after purchasing an additional 140,000 shares in the last quarter. General American Investors Co. Inc. lifted its position in shares of Arcos Dorados by 62.2% during the third quarter. General American Investors Co. Inc. now owns 700,178 shares of the restaurant operator's stock valued at $4,726,000 after purchasing an additional 268,484 shares in the last quarter. Quantbot Technologies LP lifted its position in shares of Arcos Dorados by 1,472,528.6% during the third quarter. Quantbot Technologies LP now owns 103,084 shares of the restaurant operator's stock valued at $696,000 after purchasing an additional 103,077 shares in the last quarter. Finally, Optimize Financial Inc bought a new position in shares of Arcos Dorados during the third quarter valued at about $574,000. 55.91% of the stock is owned by institutional investors.

Arcos Dorados Company Profile

Arcos Dorados Holdings Inc is the largest independent McDonald's franchisee in the world, operating under an exclusive license agreement with McDonald's Corporation. The company develops, owns and operates quick-service restaurants, offering the full McDonald's menu, including hamburgers, chicken sandwiches, salads, sides, desserts and McCafé beverages. In addition to restaurant operations, Arcos Dorados manages supply chain logistics, property development, training and support services for its franchise network.

Headquartered in Montevideo, Uruguay, Arcos Dorados serves 20 markets across Latin America and the Caribbean, including Argentina, Brazil, Chile, Colombia, Mexico, Puerto Rico and Uruguay.

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