Arcos Dorados (NYSE:ARCO) Stock Rating Lowered by Wall Street Zen

Key Points

• Arcos Dorados' stock rating has been downgraded from "buy" to "hold" by Wall Street Zen, indicating a shift in analyst sentiment toward the company.
• JPMorgan Chase cut its target price for Arcos Dorados from $10.50 to $8.80, reflecting a more cautious outlook for the stock.
• The company reported earnings of $0.11 EPS for the last quarter, which surpassed expectations, although revenue fell short of analyst predictions.

Arcos Dorados (NYSE:ARCO - Get Free Report) was downgraded by equities research analysts at Wall Street Zen from a "buy" rating to a "hold" rating in a report released on Saturday.

ARCO has been the subject of several other reports. JPMorgan Chase & Co. cut Arcos Dorados from an "overweight" rating to a "neutral" rating and lowered their target price for the stock from $10.50 to $8.80 in a research note on Wednesday, July 2nd. Weiss Ratings reiterated a "sell (d+)" rating on shares of Arcos Dorados in a research note on Friday. One equities research analyst has rated the stock with a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat, the stock presently has an average rating of "Reduce" and an average target price of $8.80.

Arcos Dorados Trading Down 0.2%

Shares of ARCO stock opened at $7.21 on Friday. Arcos Dorados has a fifty-two week low of $6.51 and a fifty-two week high of $9.33. The company has a 50 day moving average price of $6.94 and a 200 day moving average price of $7.26. The stock has a market capitalization of $1.52 billion, a P/E ratio of 11.44, a price-to-earnings-growth ratio of 3.38 and a beta of 0.60. The company has a debt-to-equity ratio of 1.62, a quick ratio of 0.73 and a current ratio of 0.80.

Arcos Dorados (NYSE:ARCO - Get Free Report) last issued its quarterly earnings results on Wednesday, August 13th. The restaurant operator reported $0.11 EPS for the quarter, beating the consensus estimate of $0.05 by $0.06. Arcos Dorados had a net margin of 2.89% and a return on equity of 24.54%. The company had revenue of $1.14 billion during the quarter, compared to analysts' expectations of $1.22 billion. During the same quarter last year, the company posted $0.13 EPS. The firm's revenue was up 2.8% compared to the same quarter last year. Equities research analysts predict that Arcos Dorados will post 0.63 EPS for the current fiscal year.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently made changes to their positions in ARCO. Lazard Asset Management LLC purchased a new position in shares of Arcos Dorados in the 2nd quarter valued at about $117,349,000. Nuveen LLC acquired a new position in Arcos Dorados in the first quarter valued at approximately $79,583,000. Pzena Investment Management LLC acquired a new position in Arcos Dorados in the second quarter valued at approximately $51,549,000. Franklin Resources Inc. increased its stake in Arcos Dorados by 50.9% in the second quarter. Franklin Resources Inc. now owns 3,907,929 shares of the restaurant operator's stock valued at $30,834,000 after purchasing an additional 1,319,031 shares during the last quarter. Finally, Moerus Capital Management LLC raised its holdings in Arcos Dorados by 67.3% during the first quarter. Moerus Capital Management LLC now owns 3,552,013 shares of the restaurant operator's stock worth $28,629,000 after purchasing an additional 1,429,338 shares in the last quarter. 55.91% of the stock is 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.

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