Recs

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4-Star Stocks Poised to Pop: Arcos Dorados

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, Arcos Dorados Holdings (NYSE: ARCO  ) has earned a respected four-star ranking. The company operates McDonald's (NYSE: MCD  ) franchises in South America.

With that in mind, let's take a closer look at Arcos Dorados' business and see what CAPS investors are saying about the stock right now.

Arcos Dorados facts

Headquarters (Founded) Buenos Aires, Argentina (2007)
Market Cap $4.56 billion
Industry Restaurants
Trailing-12-Month Revenue $3.57 billion
Management Chairman/CEO Woods Staton
CFO German Lemonnier
Trailing-12-Month Operating Margin 6.3%
Cash/Debt $251.1 million / $544.8 million
Dividend Yield 1.1%
Competitors Yum! Brands (NYSE: YUM  )

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 97% of the 242 members who have rated Arcos Dorados believe the stock will outperform the S&P 500 going forward. These bulls include Clint35 and danablanca.

This past summer, Clint35 succinctly summed up the opportunity: "Very similar to buying [McDonald's] except this one is cheaper and has more growth ahead of it."

Over the next five years, in fact, Arcos Dorados is expected to grow its bottom line at a brisk rate of 21% annually. That's faster than other restaurant stocks like Yum! Brands (13%) and Starbucks (Nasdaq: SBUX  ) (17%).

CAPS member danablanca elaborates on the Arcos Dorados bull case:

I love McDonald's. ... Smart, still cheap food for the kids, premium choices for adults = more profit. Also now have free Internet. I believe their system of delivery remains unsurpassed and this is the opportunity to access the company at a reduced entry point. [Arcos Dorados] being the largest franchisee only based in Latin America. I have not yet made the real money leap however would consider it around the $20 mark.

What do you think about Arcos Dorados, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Interested in another easy way to track Arcos Dorados? Add it to your watchlist.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Arcos Dorados, McDonald's, Starbucks, and Yum! Brands. The Fool owns shares of Starbucks and Yum! Brands. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.


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Related Tickers

4/16/2014 3:02 PM
ARCO $9.77 Up +0.17 +1.77%
Arcos Dorados CAPS Rating: ****
MCD $100.80 Down -0.03 -0.03%
McDonald's CAPS Rating: ****
SBUX $70.73 Up +1.84 +2.66%
Starbucks CAPS Rating: ****
YUM $76.60 Up +1.13 +1.50%
Yum! Brands CAPS Rating: ****

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