ARCO PE Ratio & Valuation,Is ARCO Overvalued

ARCO Relative Valuation

ARCO's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, ARCO is overvalued; if below, it's undervalued.

Historical Valuation

Arcos Dorados Holdings Inc (ARCO) is now in the Undervalued zone, suggesting that its current forward PE ratio of 10.88 is considered Undervalued compared with the five-year average of 14.41. The fair price of Arcos Dorados Holdings Inc (ARCO) is between 9.68 to 21.11 according to relative valuation methord. Compared to the current price of 7.37 USD , Arcos Dorados Holdings Inc is Undervalued By 23.93%.

Relative Value

Fair Zone

9.68-21.11

Current Price：7.37

23.93%

Undervalued

10.88

6.74

EV/EBITDA

Arcos Dorados Holdings Inc. (ARCO) has a current EV/EBITDA of 6.74. The 5-year average EV/EBITDA is 7.84. The thresholds are as follows: Strongly Undervalued below 4.30, Undervalued between 4.30 and 6.07, Fairly Valued between 9.61 and 6.07, Overvalued between 9.61 and 11.38, and Strongly Overvalued above 11.38. The current Forward EV/EBITDA of 6.74 falls within the Historic Trend Line -Fairly Valued range.

11.40

EV/EBIT

Arcos Dorados Holdings Inc. (ARCO) has a current EV/EBIT of 11.40. The 5-year average EV/EBIT is 13.21. The thresholds are as follows: Strongly Undervalued below 2.75, Undervalued between 2.75 and 7.98, Fairly Valued between 18.45 and 7.98, Overvalued between 18.45 and 23.68, and Strongly Overvalued above 23.68. The current Forward EV/EBIT of 11.40 falls within the Historic Trend Line -Fairly Valued range.

0.32

Arcos Dorados Holdings Inc. (ARCO) has a current PS of 0.32. The 5-year average PS is 0.42. The thresholds are as follows: Strongly Undervalued below 0.28, Undervalued between 0.28 and 0.35, Fairly Valued between 0.49 and 0.35, Overvalued between 0.49 and 0.56, and Strongly Overvalued above 0.56. The current Forward PS of 0.32 falls within the Undervalued range.

3.89

P/OCF

Arcos Dorados Holdings Inc. (ARCO) has a current P/OCF of 3.89. The 5-year average P/OCF is 7.26. The thresholds are as follows: Strongly Undervalued below -0.64, Undervalued between -0.64 and 3.31, Fairly Valued between 11.21 and 3.31, Overvalued between 11.21 and 15.15, and Strongly Overvalued above 15.15. The current Forward P/OCF of 3.89 falls within the Historic Trend Line -Fairly Valued range.

16.20

P/FCF

Arcos Dorados Holdings Inc. (ARCO) has a current P/FCF of 16.20. The 5-year average P/FCF is 43.60. The thresholds are as follows: Strongly Undervalued below -119.73, Undervalued between -119.73 and -38.06, Fairly Valued between 125.27 and -38.06, Overvalued between 125.27 and 206.94, and Strongly Overvalued above 206.94. The current Forward P/FCF of 16.20 falls within the Historic Trend Line -Fairly Valued range.

Arcos Dorados Holdings Inc (ARCO) has a current Price-to-Book (P/B) ratio of 2.12. Compared to its 3-year average P/B ratio of 4.15 , the current P/B ratio is approximately -48.97% higher. Relative to its 5-year average P/B ratio of 5.09, the current P/B ratio is about -58.46% higher. Arcos Dorados Holdings Inc (ARCO) has a Forward Free Cash Flow (FCF) yield of approximately 0.16%. Compared to its 3-year average FCF yield of 0.35%, the current FCF yield is approximately -52.86% lower. Relative to its 5-year average FCF yield of 2.85% , the current FCF yield is about -94.26% lower.

2.09

P/B

Median3y

4.15

Median5y

5.09

0.16

FCF Yield

Median3y

0.35

Median5y

2.85

Competitors Valuation Multiple

The average P/S ratio for ARCO's competitors is , providing a benchmark for relative valuation. Arcos Dorados Holdings Inc Corp (ARCO) exhibits a P/S ratio of , which is NaN% above the industry average. Given its robust revenue growth of 5.22%, this premium appears unsustainable.

P/S

P/E

EV/EBITDA

EV/EBIT

Revenue Growth

Market Cap

Performance Decomposition

Market capitalization of ARCO increased by 3.23% over the past 1 year. The primary factor behind the change was an increase in Margin Expansion from 3.11 to 12.62.

The secondary factor is the Revenue Growth, contributed 5.22%to the performance.

Overall, the performance of ARCO in the past 1 year is driven by Margin Expansion. Which is more sustainable.

5.22%

1.13B → 1.19B

Revenue Growth

305.79%

3.11 → 12.62

Margin Expansion

-307.78%

-3.06 → 6.35

P/E Change

3.23%

7.17 → 7.40

Mkt Cap Growth

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Frequently Asked Questions

Is Arcos Dorados Holdings Inc (ARCO) currently overvalued or undervalued?

What is Arcos Dorados Holdings Inc (ARCO) fair value?

ARCO's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average , adjusted by weights. The fair price of Arcos Dorados Holdings Inc (ARCO) is between 9.68 to 21.11 according to relative valuation methord.

How does ARCO's valuation metrics compare to the industry average?

What is the current P/B ratio for Arcos Dorados Holdings Inc (ARCO) as of Dec 16 2025?

As of Dec 16 2025, Arcos Dorados Holdings Inc (ARCO) has a P/B ratio of 2.12. This indicates that the market values ARCO at 2.12 times its book value.

What is the current FCF Yield for Arcos Dorados Holdings Inc (ARCO) as of Dec 16 2025?

As of Dec 16 2025, Arcos Dorados Holdings Inc (ARCO) has a FCF Yield of 0.16%. This means that for every dollar of Arcos Dorados Holdings Inc’s market capitalization, the company generates 0.16 cents in free cash flow.

What is the current Forward P/E ratio for Arcos Dorados Holdings Inc (ARCO) as of Dec 16 2025?

As of Dec 16 2025, Arcos Dorados Holdings Inc (ARCO) has a Forward P/E ratio of 10.88. This means the market is willing to pay $10.88 for every dollar of Arcos Dorados Holdings Inc’s expected earnings over the next 12 months.

What is the current Forward P/S ratio for Arcos Dorados Holdings Inc (ARCO) as of Dec 16 2025?

As of Dec 16 2025, Arcos Dorados Holdings Inc (ARCO) has a Forward P/S ratio of 0.32. This means the market is valuing ARCO at $0.32 for every dollar of expected revenue over the next 12 months.

ARCO Valuation