ARCOS DORADOS (ARCO) Stock: Buy, Sell, or Hold?
ARCO - ARCOS DORADOS HOLDINGS INC.
$6.91
-0.24 (-3.36%)
▼
5d:
-4.43%
30d:
-14.27%
90d:
-16.04%
WAIT
LOW Confidence
Analysis Updated: Oct 1, 2026 12:00 AM ET
Earnings: Nov 11, 2026
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Interactive Price Chart (1 Month)
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Bottom Line:
📊 MIXED SIGNALS: ARCO shows conflicting indicators. Wait for confirmation before entering.
📊 MIXED SIGNALS: ARCO shows conflicting indicators. Wait for confirmation before entering.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$12.13
Based on 6.1% avg growth
INTRINSIC VALUE TODAY
$7.53
8.3% 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 10.5x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: ARCO is currently trading at $6.91, which is considered oversold relative to its 30-day fair value range of $7.35 to $8.15. From a valuation perspective, the stock is trading at a discount (Forward PE: 8.0) compared to its historical average (10.5). Remarkably, the market is currently pricing in an annual earnings decline of 8.4% over the next few years. This pessimistic expectation contrasts with the company's recent 99.3% earnings growth, suggesting potential undervaluation if the company simply maintains stability.
Technical Outlook: Technically, ARCO is in a downtrend. Immediate support is located at $6.67, while resistance sits at $7.67. Short-term momentum is weak, with the stock down 3.4% recently.
Market Sentiment: ARCO scores 25/100 on our bottoming-setup gauge. Note this measures entry quality, not trend direction — a low score can mean the chart is extended after a strong run (don't chase) or still falling without stabilization; better entries typically come after a pullback toward the 20-day average. Wall Street analysts see significant upside, with an average price target of $11.29 (+63.4%). Current signals suggest waiting for a better entry point before initiating new positions.
Technical Outlook: Technically, ARCO is in a downtrend. Immediate support is located at $6.67, while resistance sits at $7.67. Short-term momentum is weak, with the stock down 3.4% recently.
Market Sentiment: ARCO scores 25/100 on our bottoming-setup gauge. Note this measures entry quality, not trend direction — a low score can mean the chart is extended after a strong run (don't chase) or still falling without stabilization; better entries typically come after a pullback toward the 20-day average. Wall Street analysts see significant upside, with an average price target of $11.29 (+63.4%). Current signals suggest waiting for a better entry point before initiating new positions.
Quick Decision Summary
Current Position
OVERSOLD
Historical Trading Range
$7.35 -
$8.15
Company Quality Score
37/100
(SELL)
Volume Confirmation
HIGH
Confidence Score
52.4%
All Signals
- BULLISH: Price oversold vs 30-day range
- BEARISH: Weak technical setup (25/100)
- BULLISH: High volume confirmation
- BEARISH: Downward momentum (-3.4%)
- BULLISH: Trading 63.4% below Wall St target ($11.29)
- WARNING: Composite score 37/100 in the bottom quintile — this cohort historically lags the market
Trading Range Analysis
30-Day Trading Range
$7.35 -
$8.15
Current vs Trading Range
OVERSOLD
Support & Resistance Levels
Support Level
$6.67
Resistance Level
$7.67
Current Trend
Downtrend
Technical data as of
Oct 1, 2026
Fundamental Context
Forward P/E (Next Year Est.)
8.04
Wall Street Target
$11.29
(+63.4%)
Revenue Growth (YoY)
14.3%
Earnings Growth (YoY)
99.3%
Profit Margin
5.2%
Valuation Discount vs History
-8.4% cheaper
PE vs Historical
8.0 vs 10.5
CHEAP
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
-8.4%
(market-implied from PE analysis)
1-Year Target
$6.33
(-8%)
2-Year Target
$5.80
(-16%)
3-Year Target
$5.31
(-23%)
3-Yr Target (if PE normalizes)
(PE: 8→11)
$6.94
(+0%)
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 20.4, Growth: 8.2%)
$22.22
(+222%)
Base:
(SPY PE: 8.0, Growth: 8.2%)
$8.75
(+27%)
Bear:
(PE: 6.8, Growth: 8.2%)
$7.44
(+8%)
📈
Valuation based on Current Earnings
Trailing PE: 5.79 | Current EPS (TTM): $1.23
Bull Case
$5.47
(-23%)
Analyst growth -30.1%, PE expands to 6.4
Base Case
$4.98
(-30%)
Market implied -30.1%, PE stable at 5.8
Bear Case
$4.84
(-32%)
Severe decline -20.0%, PE contracts to 4.9
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 8.0 to 10.5
Stabilization Target:
$9.03
(+30.6%)
PE Expansion Potential:
+30.6%
Share & Embed Analysis
Last updated: October 01, 2026 5:02 PM ET
Data refreshes hourly during market hours. Next update: 6:02 PM
Data refreshes hourly during market hours. Next update: 6:02 PM
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Technical Signals Check
Is ARCO showing a specific setup today?
Insider Activity (6 Months)
0
Buys
0
Sells
0
Net
NEUTRAL
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