olivLaw · US equity research
Arcos Dorados Holdings Inc. ARCO
Retail-Eating Places · SIC 5812 · Vertical: Retail-Eating Places (SIC 5812)
Arcos Dorados is the world's largest independent McDonald's franchisee, with exclusive rights to own, operate and franchise restaurants in 21 countries and territories across Latin America and the Caribbean. In fiscal 2025 the company reported total revenues of 4678.3 million USD, and restaurant expansion and reimaging remain central to its strategy.
The AI analysis may be outdated: new filings came after its sources (see the «AI analysis» section).
At the close of 04 Nov 2026, Arcos Dorados Holdings Inc. (ARCO) stock was 7.09 USD (+4.11% on the day), with market capitalisation 1.5 bn USD, P/E 7.0 on diluted EPS of 1.01 USD over the last 12 months, dividend yield 3.39%, beta 0.81, 52-week range 6.73–9.50 USD.
Data as of · AI analysis dated · Source: SEC filings and closing prices, computed by olivLaw.
Price history
Loading chart…
Technical reading
- RSI (14)
- 41.8
- weak (30–45)
- Bollinger (20, 2)
- 6.47 – 8.64
- in the lower half of the band · %B 0.29 · band width 28.7%
- SMA 50 / 200
- 7.67 / 8.20
- downtrend (price < SMA50 < SMA200)
- MACD (12, 26, 9)
- -0.24 / -0.15
- MACD below signal
Indicators describe past prices; on their own they do not predict direction. On our history the RSI ≤ 40 filter added no return (see the signals methodology).
Performance
| Company | S&P 500 | vs S&P 500 | Vertical median | |
|---|---|---|---|---|
| 1 month | −12.5% | −1.1% | −11.4 pp | — |
| 3 months | −16.3% | −0.5% | −15.8 pp | — |
| 6 months | −21.6% | +4.4% | −26.0 pp | — |
| Year to date | −3.4% | +12.3% | −15.7 pp | — |
| 1 year | +2.2% | +13.5% | −11.4 pp | +8.3% |
| 3 years | −28.7% | +76.4% | −105.2 pp | −16.1% |
| 5 years | +46.8% | +63.7% | −16.9 pp | — |
Price returns, dividends excluded.
Quarterly results
ESEF annual reports carry no quarters: the results are annual (below).
E/P over time
E/P = trailing-12-month diluted EPS / price at quarter end. E/P is the inverse of P/E and stays defined when earnings are negative.
Today's P/E sits at the 0 percentile of its own 9-quarter history (min 7.3, median 14.8, max 43.9; quarters with earnings only).
Fiscal years
| Fiscal year | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|
| Revenue | 3.1 bn | 3.0 bn | 2.0 bn | 2.7 bn | 3.6 bn | 4.3 bn | 4.5 bn | 4.7 bn |
| Revenue YoY | −7.2% | −4.0% | −32.9% | +34.1% | +36.1% | +19.7% | +3.2% | +4.7% |
| Net income | 36.8 m | 79.9 m | -149.5 m | 45.5 m | 140.3 m | 181.3 m | 148.8 m | 212.1 m |
| Net income YoY | −71.5% | +116.8% | −287.1% | unavailable | +208.5% | +29.2% | −17.9% | +42.6% |
| Diluted EPS | 0.18 | 0.38 | -0.72 | 0.22 | 0.67 | 0.86 | 0.71 | 1.01 |
| Diluted EPS YoY | −70.5% | +111.1% | −289.5% | unavailable | +204.5% | +28.4% | −17.4% | +42.3% |
| net % | 1.2% | 2.7% | -7.5% | 1.7% | 3.9% | 4.2% | 3.3% | 4.5% |
| Free cash flow | -17.3 m | -41.8 m | -70.3 m | 143.0 m | 128.3 m | 21.9 m | -60.8 m | 15.0 m |
Reported results vs expectations
Loading…
Balance sheet & financial health
Fiscal year 2025 · 31 Dec 2025
- Cash
- 373.4 m USD
- Financial debt
- 1.1 bn USD
- Net debt
- 752.4 m USD
- Equity
- 772.1 m USD
- Total assets
- 3.9 bn USD
- Debt / equity
- 1.46x
- Current ratio
- 1.03x
- ROE
- 33.1%
- ROA
- 6.3%
- FCF margin
- 0.3%
Financial statements (source on every figure)
Revenue and net income (USD)
Margins
Income statement · USD
| Line | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Source (latest year) |
|---|---|---|---|---|---|---|---|
| Revenue | 2.0 bn | 2.7 bn | 3.6 bn | 4.3 bn | 4.5 bn | 4.7 bn | SEC (XBRL)· 30 Apr 2026verified |
| Cost of revenue | 43.5 m | 50.6 m | 68.0 m | 83.4 m | 83.7 m | 89.5 m | SEC (XBRL)· 30 Apr 2026verified |
| Gross profit | 1.9 bn ≈ | 2.6 bn ≈ | 3.6 bn ≈ | 4.2 bn ≈ | 4.4 bn ≈ | 4.6 bn ≈ | SEC (XBRL)· 30 Apr 2026derived |
| Operating income | -66.8 m | 139.5 m | 264.4 m | 314.0 m | 324.5 m | 364.4 m | SEC (XBRL)· 30 Apr 2026verified |
| Depreciation & amortisation | 126.9 m | 120.4 m | 119.8 m | 149.3 m | 177.4 m | 197.3 m | SEC (XBRL)· 30 Apr 2026verified |
| EBITDA | 60.1 m ≈ | 259.9 m ≈ | 384.2 m ≈ | 463.3 m ≈ | 501.9 m ≈ | 561.7 m ≈ | SEC (XBRL)· 30 Apr 2026derived |
| Interest expense | 33.4 m | 49.5 m | 43.8 m | 32.3 m | 47.2 m | 13.7 m | SEC (XBRL)· 30 Apr 2026verified |
| Pre-tax income | -131.9 m | 77.8 m | 226.4 m | 278.1 m | 259.3 m | 341.3 m | SEC (XBRL)· 30 Apr 2026verified |
| Income tax | 17.5 m | 31.9 m | 85.5 m | 95.7 m | 109.9 m | 128.7 m | SEC (XBRL)· 30 Apr 2026verified |
| Net income | -149.5 m | 45.5 m | 140.3 m | 181.3 m | 148.8 m | 212.1 m | SEC (XBRL)· 30 Apr 2026verified |
| Diluted EPS | -0.72 | 0.22 | 0.67 | 0.86 | 0.71 | 1.01 | SEC (XBRL)· 30 Apr 2026verified |
| Weighted average diluted shares | 208.7 m | 210.5 m | 210.6 m | 210.6 m | 210.7 m | 210.7 m | SEC (XBRL)· 30 Apr 2026verified |
| Dividend per share | 0.05 | — | 0.15 | 0.19 | 0.24 | 0.24 | SEC (XBRL)· 30 Apr 2026verified |
≈ computed by olivLaw from the reported lines of the same year: Revenue − Cost of revenue; Operating income + Depreciation & amortisation.
Balance sheet · USD
| Line | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Source (latest year) |
|---|---|---|---|---|---|---|---|
| Cash | 166.0 m | 278.8 m | 266.9 m | 196.7 m | 135.1 m | 373.4 m | SEC (XBRL)· 30 Apr 2026verified |
| Inventories | 33.6 m | 37.8 m | 50.1 m | 52.8 m | 51.7 m | 66.4 m | SEC (XBRL)· 30 Apr 2026verified |
| Current assets | 415.5 m | 540.1 m | 684.4 m | 605.3 m | 468.4 m | 852.0 m | SEC (XBRL)· 30 Apr 2026verified |
| Property, plant & equipment, net | 796.5 m | 743.5 m | 856.1 m | 1.1 bn | 1.1 bn | 1.3 bn | SEC (XBRL)· 30 Apr 2026verified |
| Goodwill | 5.6 m | 5.2 m | 7.2 m | 11.9 m | 13.3 m | 16.6 m | SEC (XBRL)· 30 Apr 2026verified |
| Intangibles (excl. goodwill) | 31.4 m | 33.6 m | 47.3 m | 58.1 m | 53.3 m | 132.3 m | SEC (XBRL)· 30 Apr 2026verified |
| Total assets | 2.3 bn | 2.4 bn | 2.6 bn | 3.0 bn | 2.9 bn | 3.9 bn | SEC (XBRL)· 30 Apr 2026verified |
| Accounts payable | 209.5 m | 269.2 m | 353.5 m | 375.0 m | 347.9 m | 356.6 m | SEC (XBRL)· 30 Apr 2026verified |
| Short-term debt | 0 | 0 | 318.0 k | 29.5 m | 60.3 m | 0 | SEC (XBRL)· 30 Apr 2026verified |
| Long-term debt | 773.4 m | 739.2 m | 711.7 m | 713.0 m | 716.0 m | 1.1 bn | SEC (XBRL)· 30 Apr 2026verified |
| Current liabilities | 503.5 m | 617.9 m | 759.4 m | 841.7 m | 765.9 m | 828.7 m | SEC (XBRL)· 30 Apr 2026verified |
| Total liabilities | 2.1 bn | 2.1 bn | 2.3 bn | 2.5 bn | 2.4 bn | 3.1 bn | SEC (XBRL)· 30 Apr 2026verified |
| Equity | 198.0 m | 221.2 m | 324.4 m | 516.8 m | 509.4 m | 772.1 m | SEC (XBRL)· 30 Apr 2026verified |
Cash flow · USD
| Line | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Source (latest year) |
|---|---|---|---|---|---|---|---|
| Operating cash flow | 16.0 m | 258.0 m | 345.4 m | 382.0 m | 266.8 m | 296.3 m | SEC (XBRL)· 30 Apr 2026verified |
| Capex | 86.3 m | 115.0 m | 217.1 m | 360.1 m | 327.6 m | 281.4 m | SEC (XBRL)· 30 Apr 2026verified |
| Free cash flow | -70.3 m ≈ | 143.0 m ≈ | 128.3 m ≈ | 21.9 m ≈ | -60.8 m ≈ | 15.0 m ≈ | SEC (XBRL)· 30 Apr 2026derived |
| Investing cash flow | -88.7 m | -108.3 m | -259.6 m | -380.3 m | -280.3 m | -335.0 m | SEC (XBRL)· 30 Apr 2026verified |
| Financing cash flow | 126.0 m | -17.9 m | -60.0 m | -11.8 m | -37.2 m | 288.8 m | SEC (XBRL)· 30 Apr 2026verified |
| Dividends paid | 10.2 m | 21.0 k | 31.6 m | 40.0 m | 50.6 m | 50.6 m | SEC (XBRL)· 30 Apr 2026verified |
| Share repurchases | 0 | 0 | — | — | — | — | SEC (XBRL)· 29 Apr 2022verified |
≈ computed by olivLaw from the reported lines of the same year: Operating cash flow − Capex.
Computed indicators
Growth
Profitability
Returns
Balance sheet
Liquidity
Cash
Efficiency
Market and valuation
1 indicators that do not apply to the sector.
Valuation
olivLaw classification
Score: 63 / 100
A scoring methodology on indicators and valuation, not investment advice.
Closing price
04 Nov 2026Source: olivLaw, closing series
Market cap: 1.5 bn USD
Key indicators
Coverage and freshness
Score by group
- Valuation74
- Returns29
- Quality49
- Balance sheet63
- Growth86
Estimated value range
The combined range = the median of the valid methods' low, central and high values; it is not a probability interval and does not cover every result. Envelope of all methods: 16.36 – 40.34 USD.
Methods computed but outside the aggregate range: Dividend discount (DDM) (a small share of earnings is paid as dividends (capital returns through buybacks): the dividend model does not describe the value and stays outside the aggregate).
Valuation assumptions are editorial choices, not measured; beta is not measured.
Method ranges (USD per share)
— — Mid · ▏ Price
Valuation methods
- DCF (discounted cash flow)unavailable · equity is negative: the ratio is not economically meaningful (not by itself insolvency; usually the result of buybacks)
- Peers: EV/EBITDA16.36 – 40.34 (Mid 23.73)21 companies used · median multiple 10.2x · quartiles 7.5x – 16.5xARMK, BJRI, BLMN, CAKE, CBRL, DRI, FWRG, LOCO, MCD, NDLS, PLAY, PTLO, PZZA, QSR, RICK, RRGB, STKS, TXRH, WING, YUM, YUMC
- Peers: P/E18.46 – 33.86 (Mid 26.52)20 companies used · median multiple 26.3x · quartiles 18.3x – 33.5xARMK, BJRI, BLMN, CAKE, CBRL, CMG, DRI, EAT, FWRG, JACK, LOCO, MB, MCD, PTLO, PZZA, QSR, TXRH, WING, YUM, YUMC
- Dividend discount (DDM)outside the aggregate3.15 – 4.24 (Mid 3.62)a small share of earnings is paid as dividends (capital returns through buybacks): the dividend model does not describe the value and stays outside the aggregate
Classification (SIC) comparables group by industry code, not by economic activity; the direct group is an editorial selection by activity. Members' multiples are on their own trailing twelve months, at their own latest close.
Assumptions (illustrative, editorial)
- Risk-free rate
- 4.3%
- Equity risk premium
- 5.0%
- Beta (default)
- 1.00
- Cost of equity
- 9.3%
- Terminal growth
- 2.5%
Factor scorecard
Neutral profile · Score 63/100
| Factor | Value | Score | Weight used |
|---|---|---|---|
| ROIC · Quality | 17.0% | 68 (vs peers) | 10% |
| Net margin · Quality | 4.5% | 67 (vs peers) | 6% |
| FCF conversion · Quality | 7.1% | 0 (on a fixed band) | 6% |
| Revenue CAGR 3Y · Growth | 8.9% | 74 (on a fixed band) | 8% |
| EPS CAGR 3Y · Growth | 14.7% | 98 (on a fixed band) | 8% |
| Net debt / EBITDA · Balance sheet | 1.3x | 59 (vs peers) | 10% |
| Interest coverage · Balance sheet | 26.7x | 100 (on a fixed band) | 6% |
| Current ratio · Balance sheet | 1.0x | 19 (on a fixed band) | 4% |
| P/E (TTM) · Valuation | 7.0x | 96 (vs peers) | 10% |
| EV/EBITDA · Valuation | 4.0x | 100 (vs peers) | 10% |
| FCF yield · Valuation | 1.0% | 13 (on a fixed band) | 8% |
| Shareholder yield (distributions) · Returns | 3.4% | 48 (on a fixed band) | 6% |
| Payout ratio (FCF) · Returns | 337.2% | 0 (on a fixed band) | 4% |
Score groups
- Balance sheet63/100 · 3/3 factors with a value
- Growth86/100 · 2/2 factors with a value
- Quality49/100 · 3/3 factors with a value
- Returns29/100 · 2/2 factors with a value
- Valuation74/100 · 3/3 factors with a value
Memo
Arcos Dorados Holdings Inc. (ARCO). Latest full fiscal year: 2025; data up to 2025-12-31.
Figures computed from the financial statements: revenue 4.7 bn USD in 2025; YoY growth 4.7%; net margin 4.5%; ROE 33.2%; net debt/EBITDA 1.3x.
The estimated value range is 17.41–37.10 USD per share (median of 2 methods, agreement: same basis (multiples on one peer group, not independent confirmations)); assumptions are illustrative. Against the central value of 25.13 USD, the price of 7.09 USD leaves a potential of 254.4% (value / price − 1) and a margin of safety of 71.8% (1 − price / value). The range is the median of the methods' low, central and high values, not a probability interval.
olivLaw score 63/100, methodological classification: neutral profile (score, margin of safety and method agreement together; not a judgement of the right price). Not investment advice.
Text generated deterministically from the figures shown; no language model. Not investment advice.
What supports the thesis
- Revenue CAGR 3Y: 8.9%
- EPS CAGR 3Y: 14.7%
- Interest coverage: 26.7x
- P/E (TTM): 7.0x
- EV/EBITDA: 4.0x
- The price is below the estimated value range
What contradicts it
- FCF conversion: 7.1%
- Current ratio: 1.0x
- FCF yield: 1.0%
- Payout ratio (FCF): 337.2%
Versus the vertical median
Retail-Eating Places (SIC 5812) · same industry (4-digit SIC) · compared with 39 companies
Multiples and returns vs the median
Price rebased to 100 (monthly, 5 years)
Companies in the vertical
| Market cap | P/E | ROE | Net margin | Revenue YoY | 1A / 3A | |
|---|---|---|---|---|---|---|
| MCDMcDONALD’S CORPORATION | 198.3 bn | 0.0 | — | 31.7% | +3.7% | −10% / −1% |
| YUMYum! Brands, Inc. | 45.4 bn | 20.9 | — | 25.4% | +8.8% | +9% / +32% |
| CMGChipotle Mexican Grill, Inc. | 44.5 bn | 32.9 | 48.5% | 10.8% | +5.4% | +2% / −20% |
| DRIDarden Restaurants, Inc. | 26.1 bn | 22.5 | 55.1% | 8.8% | +9.4% | +28% / +47% |
| QSRRestaurant Brands International Inc. | 24.8 bn | 18.2 | 53.8% | 20.1% | +12.2% | +8% / +10% |
| YUMCYum China Holdings, Inc. | 17.0 bn | 18.3 | 17.5% | 7.8% | +4.4% | +3% / +15% |
| ARMKAramark | 13.8 bn | 36.7 | 11.8% | 1.9% | +6.4% | +41% / +87% |
| TXRHTexas Roadhouse, Inc. | 12.9 bn | 31.3 | 28.1% | 6.8% | +9.4% | +12% / +75% |
| EATBrinker International, Inc. | 9.2 bn | 19.4 | 134.7% | 8.4% | +7.9% | +43% / +512% |
| CAVACAVA Group, Inc. | 7.2 bn | 109.3 | 8.3% | 4.8% | +22.4% | +27% / +82% |
| HDLSuper Hi International Holding Ltd. | 6.4 bn | 247.5 | 6.9% | 2.8% | +13.4% | −46% / unavailable |
| CAKEThe Cheesecake Factory Incorporated | 5.8 bn | 27.4 | 41.6% | 5.2% | +4.7% | +142% / +268% |
| WINGWingstop Inc. | 4.5 bn | 39.3 | — | 16.0% | +11.4% | −37% / −30% |
| CBRLCracker Barrel Old Country Store, Inc. | 1.6 bn | 50.2 | 6.7% | 1.0% | −4.7% | +143% / +5% |
| ARCOArcos Dorados Holdings Inc. | 1.5 bn | 7.0 | 33.2% | 4.5% | +4.7% | +2% / −29% |
| BJRIBj’s Restaurants, Inc. | 1.3 bn | 33.0 | 10.4% | 2.9% | +3.1% | +61% / +106% |
| SGSweetgreen, Inc. | 1.1 bn | 117.9 | 3.1% | 2.0% | +0.4% | +82% / +25% |
| BLMNBloomin’ Brands, Inc. | 939.3 m | 35.1 | 6.7% | 0.7% | +0.1% | +55% / −53% |
| FWRGFirst Watch Restaurant Group, Inc. | 833.3 m | 42.1 | 3.1% | 1.5% | +20.3% | −27% / −25% |
| PZZAPapa John’s International, Inc. | 658.1 m | 25.1 | — | 1.4% | −0.3% | −52% / −69% |
| LOCOEl Pollo Loco Holdings, Inc. | 501.2 m | 14.1 | 11.8% | 7.0% | +3.6% | +51% / +98% |
| DINDine Brands Global, Inc. | 448.6 m | 106.7 | — | 0.4% | +8.2% | +17% / −16% |
| PTLOPortillo's Inc. | 336.8 m | 29.8 | 3.0% | 1.9% | +3.0% | +4% / −65% |
| PLAYDave & Buster’s Entertainment, Inc. | 305.8 m | — | -69.7% | -4.3% | −1.4% | −50% / −79% |
| JACKJack In The Box Inc. | 275.6 m | 8.2 | — | 2.4% | −6.7% | −27% / −80% |
1- and 3-year price returns: for ARCO from daily closes (the same as the performance table), for the other companies from month-end closes.
olivLaw engine forecast
The world engine ran after the company's latest material disclosure. Probabilities are of TOUCHING a level within the horizon (not closing there) and sit next to the random walk (p_rw), the no-information benchmark.
The engine has no published run for this company yet.
Valuation scenarios (editable assumptions)
Illustrative scenarios
Illustrative: not forecasts and without probabilities. Each case is one coherent set of assumptions, computed on today's figures.
Estimated price (USD)
| Estimated price | Bear | Base | Bull |
|---|---|---|---|
| 1 years | 4.36 Total return -36% · Per year -36% | 7.70 Total return 12% · Per year 12% | 11.58 Total return 68% · Per year 68% |
| 3 years | 4.62 Total return -26% · Per year -10% | 9.14 Total return 41% · Per year 12% | 15.03 Total return 127% · Per year 31% |
| 5 years | 4.89 Total return -16% · Per year -3% | 10.84 Total return 75% · Per year 12% | 19.51 Total return 204% · Per year 25% |
- Exit P/E± 2.28
- Net margin± 1.60
- Annual revenue growth± 1.26
- Annual dilution± 0.13
AI analysis
AI-generatedAI-generated analysis (Claude) from cited public sources; it may contain errors. Not investment advice. As of 27 Oct 2026 · Model: claude-haiku-5-5.
Possibly outdated: the newest document it read is from 30 Apr 2026; since then the company filed 6-K (01 Oct 2026), 6-K (13 Aug 2026), 6-K (20 May 2026).
In brief
Arcos Dorados is the world's largest independent McDonald's franchisee, with exclusive rights to own, operate and franchise restaurants in 21 countries and territories across Latin America and the Caribbean. In fiscal 2025 the company reported total revenues of 4678.3 million USD, and restaurant expansion and reimaging remain central to its strategy.
SWOT
Strengths
- The McDonald's brand and the relationship with the franchisor are described as the main competitive advantages.
- The network is diversified across three geographic divisions, which reduces dependence on any single market.
- Brand extensions such as McCafé and Dessert Centers offer higher margins than regular restaurant operations.
Weaknesses
- Dependence on the MFAs and on the relationship with McDonald's limits the company's strategic freedom.
- The company lacks full operational control over sub-franchisees, whose financial health partly determines its own results.
- Owning or leasing a large real estate portfolio exposes the company to losses and liabilities.
Opportunities
- Urbanization and demand for convenience could open new locations in densely populated areas.
- Growth of McCafé and Dessert Centers could raise market penetration with relatively modest investment.
- The loyalty program and restaurant reimaging could support visit frequency.
Threats
- Inflation, price controls and currency restrictions in some countries could affect results.
- Intense fast food competition and shifting consumer preferences could reduce demand.
- Political and social instability in some countries could disrupt operations.
Risks
- Dependence on the MFAshigh
Operating rights derive exclusively from contracts with McDonald's, and their termination would materially harm the business.
- Currency and transfer controlshigh
Currency devaluations and restrictions on moving money across borders could affect results and the payment of dividends.
- Inflation and price controlsmedium
Inflation and price regulation in some countries could reduce margins or limit revenue growth.
- Labor and commodity costsmedium
Rising labor, commodity or logistics costs could reduce operating results.
- Political and social instabilitymedium
Political changes and social tensions in certain countries could affect operations and the company's outlook.
Investment thesis
What would need to be true (bull case)
- If the McDonald's brand and the broad network keep their advantage, the company could continue to benefit from urbanization and demand for convenience in the region.
- If McCafé and Dessert Center growth continues, margins could stay solid, supported by relatively low capital needs.
- Geographic diversification could cushion economic shocks in any single country if markets move differently.
What would break the thesis
- If inflation and currency devaluations persist, revenues reported in US dollars could be hit negatively.
- Dependence on the MFAs and the McDonald's relationship could limit strategic flexibility if conditions change.
- If fast food competition intensifies, pressure on prices and promotions could compress margins.
What to watch
- Delivery of the capital expenditure plan of 275 to 325 million USD against the 2026 guidance2026
- Trends in comparable sales and traffic across the three divisionsQ1 2027
- Currency and inflation developments in the countries with the largest resultsnext 10-K
- Progress of negotiations with McDonald's on opening and reimaging plans2027
Products, market & competition
AI-generatedAI-generated analysis (Claude) from cited public sources; it may contain errors. Not investment advice. As of 27 Oct 2026 · Model: claude-haiku-5-5.
Possibly outdated: the newest document it read is from 30 Apr 2026; since then the company filed 6-K (01 Oct 2026), 6-K (13 Aug 2026), 6-K (20 May 2026).
The business
Arcos Dorados operates McDonald's restaurants in 21 countries and territories across Latin America and the Caribbean under MFAs with McDonald's Corporation that run through December 31, 2044 for most Territories. As of December 31, 2025 the company operated or franchised 2520 restaurants, of which 71.4% were company-operated and the rest franchised. Revenues come mainly from company-operated restaurant sales and rent from sub-franchisees.
The economics differ between the two formats: company-operated restaurants keep operating profit after expenses and royalties paid to McDonald's, while franchised restaurants are funded by sub-franchisees who pay rent based on the greater of a fixed fee or a percentage of sales. The company owns or leases the real estate and sub-leases it to sub-franchisees.
The company also develops brand extensions such as McCafé locations and Dessert Centers, which require low capital and generate higher margins than regular restaurants. The 2026 investment plan covers new openings and reimaging of existing restaurants under plans agreed with McDonald's.
Segments
Brazil
Brazil holds 48.8% of the restaurants and generated revenues of 1770301 thousand USD in fiscal 2025, with a dense network of Dessert Centers supporting its position.
NOLAD
The NOLAD division, covering Mexico, Costa Rica, Panama and Puerto Rico, generated revenues of 1266129 thousand USD in fiscal 2025 and holds 26.6% of restaurants.
SLAD
The SLAD division, covering Argentina, Chile, Peru and Colombia, generated revenues of 1641829 thousand USD in fiscal 2025, holds 24.6% of restaurants and grew from 2024.
Market context
The company operates in the QSR sub-segment of the fast food industry in Latin America and the Caribbean, where urban modernization and demand for convenience, speed and value support demand. Diversification across three divisions reduces dependence on any one economy, though inflation and exchange rates remain important factors.
The company says it kept average check growth roughly in line with inflation in fiscal 2025 and 2024, which supported revenues in inflationary environments. Its 4.4% share of McDonald's global sales shows the regional scale of the network.
Trends
- Urbanization and conveniencetailwind
Rising urban density in Latin America is pushing more consumers toward convenience, speed and value, which could support QSR restaurant traffic.
- Network reimagingmixed
Reimaging and new openings required under the MFA plans can support brand perception, but they require large investment and temporary closures.
- Inflation and currencyheadwind
Inflation and currency devaluations in some countries could reduce customers' purchasing power and weigh on results reported in US dollars.
- Brand extensionstailwind
McCafé locations and Dessert Centers, with low capital needs and higher margins, could raise market penetration if their expansion continues.
Competitive position
The company competes in the food service industry, described in the filing as intensely competitive, where fast food chains and informal eating out fight for the same customers. The McDonald's brand and the broad network are the main advantages, but local price and promotion competition remains strong.
The filing does not explicitly name US-listed competitors, so only general categories of regional and local fast food and informal eating competitors are shown.
- Regional and local fast food operators
Local fast food operators in the Territories competing on price and promotions.
- Other international QSR chains
Fast food chains active in Latin America competing directly for customer traffic.
- Informal eating out
Street food and other informal eating out options cited in the filing as part of the competition.
- Coffee and dessert outlets
Coffee and dessert operators competing with McCafé locations and Dessert Centers.
Links, dependencies and risks
Who the company is tied to, from its own SEC filings (customers, suppliers, production, partners, competitors, countries, regulation), from the 5 %+ holders' statements (13D/13G) and from what other companies say about it. Click a node for its evidence; on a listed company the graph moves to it.
Loading the links…
News & filings
In the press
No news in our archive over the last 180 days.
SEC filings
- Current report (foreign issuer)01 Oct 2026
- Current report (foreign issuer)13 Aug 2026
- Current report (foreign issuer)13 Aug 2026
- Current report (foreign issuer)20 May 2026
- Current report (foreign issuer)20 May 2026
- Annual report (foreign issuer)30 Apr 2026
- Current report (foreign issuer)14 Apr 2026
- Current report (foreign issuer)26 Mar 2026
- Current report (foreign issuer)19 Mar 2026
- Current report (foreign issuer)19 Mar 2026
Sources
- [1] Form 20-F, fiscal year ended 2025-12-31 · SEC / Arcos Dorados Holdings Inc. · 30 Apr 2026
Figures computed by olivLaw from SEC filings and closing prices; the qualitative analysis is AI-generated from cited sources. Not investment advice.