Goldman Sachs Reiterates Buy Rating on Arcos Dorados Holdings (ARCO)

Goldman Sachs analyst Thiago Bortoluci reiterated a Buy rating and $14.30 price target on Arcos Dorados Holdings (NYSE: ARCO).

The analyst comments "Arcos shares are down by 28% YTD (vs. -19% for the Ibovespa, in US$), in our view mainly as investors reflected rising concerns ahead of the renewal of its master-franchisee agreement (MFA) with McDonald's Corp., as well as baking in a series of negative non-operating earnings surprises over recent quarters. Our analysis suggests the market is already pricing in a scenario of c.200bp higher royalties or the opening of 50-55 new ROIC-dilutive stores per year over the next 20 years, with shares offering what we view as a positive risk-reward skew ahead of the MFA event (due by August 2024). Arcos is our preferred stock with exposure to Brazil domestic, and we reiterate our Buy-rating."

For an analyst ratings summary and ratings history on Arcos Dorados Holdings click here. For more ratings news on Arcos Dorados Holdings click here.

Shares of Arcos Dorados Holdings closed at $9.14 yesterday.

You May Also Be Interested In

• JD.com (JD) Reiterated at Buy by Benchmark Amid Earnings Recovery
• Movano (MOVE) Misses Q2 EPS by 195c
• UBS Reiterates Buy Rating on NVIDIA (NVDA), Expects Q2 Revenue Beat