Fast-food chain Arcos Dorados (NYSE: ARCO) will be announcing earnings results this Wednesday before market open. Here’s what investors should know.
Arcos Dorados missed analysts’ revenue expectations by 3.6% last quarter, reporting revenues of $1.08 billion, flat year on year. It was a disappointing quarter for the company, with a significant miss of analysts’ same-store sales estimates and a significant miss of analysts’ EPS estimates.
Is Arcos Dorados a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Arcos Dorados’s revenue to grow 4.7% year on year to $1.16 billion, slowing from the 6.8% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.07 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Arcos Dorados has missed Wall Street’s revenue estimates three times over the last two years.
Looking at Arcos Dorados’s peers in the traditional fast food segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Dutch Bros delivered year-on-year revenue growth of 28%, beating analysts’ expectations by 3.1%, and Papa John's reported revenues up 4.2%, topping estimates by 2.7%. Dutch Bros traded up 21.6% following the results while Papa John's was also up 6.9%.
Read our full analysis of Dutch Bros’s results here and Papa John’s results here.
The euphoria surrounding Trump’s November win lit a fire under major indices, but potential tariffs have caused the market to do a 180 in 2025. While some of the traditional fast food stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 8.7% on average over the last month. Arcos Dorados is down 8% during the same time and is heading into earnings with an average analyst price target of $10.46 (compared to the current share price of $6.76).
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