Shares of fast-food chain Arcos Dorados (NYSE:ARCO)
jumped 7.4% in the morning session after the company reported mixed second-quarter results that saw profits beat expectations but revenue fall short. The master franchisee for McDonald's in Latin America and the Caribbean posted earnings of $0.11 per share, easily surpassing analyst estimates of $0.08. However, total revenue of $1.14 billion missed Wall Street's expectations, growing just 2.8% year-over-year. While same-store sales, which track performance at restaurants open for at least a year, grew a solid 12.1%, this represented a significant slowdown from previous periods. The company's operating margin also declined to 5.5% from 6.7% in the same quarter last year. Investors appeared to weigh the strong profit beat against the revenue miss and decelerating growth, leading to a muted reaction for the stock.
Fast-food chain Arcos Dorados (NYSE:ARCO) fell short of the market’s revenue expectations in Q2 CY2025 as sales rose 2.8% year on year to $1.14 billion. Its GAAP profit of $0.11 per share was 40.8% above analysts’ consensus estimates.
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Arcos Dorados (NYSE:ARCO) and the rest of the traditional fast food stocks fared in Q1.
From fast food to fine dining, restaurants play a vital societal role. But the side dish is that they’re quite difficult to operate because high inventory and labor costs generally lead to thin margins at the store level.
This leaves little room for error if demand dries up, and it seems like the market has some reservations as the industry has tumbled by 4% over the past six months. This performance was discouraging since the S&P 500 returned 4.1%.
Let’s dig into the relative performance of Yum China (NYSE:YUMC) and its peers as we unravel the now-completed Q1 traditional fast food earnings season.
The stocks in this article have caught Wall Street’s attention in a big way, with price targets implying returns above 20%.
But investors should take these forecasts with a grain of salt because analysts typically say nice things about companies so their firms can win business in other product lines like M&A advisory.
A stock with low volatility can be reassuring, but it doesn’t always mean strong long-term performance.
Investors who prioritize stability may miss out on higher-reward opportunities elsewhere.
Fast-food chain Arcos Dorados (NYSE:ARCO) fell short of the market’s revenue expectations in Q1 CY2025, with sales flat year on year at $1.08 billion. Its GAAP profit of $0.07 per share decreased from $0.14 in the same quarter last year.
From fast food to fine dining, restaurants play a vital societal role. But it’s not all sunshine and rainbows as they’re notoriously hard to run thanks to perishable ingredients, labor shortages, or volatile consumer spending.
Unfortunately, these factors have spelled trouble for the industry as it has shed 9.1% over the past six months. This drop was disheartening since the S&P 500 stood firm.
Small-cap stocks can be incredibly lucrative investments because their lack of analyst coverage leads to frequent mispricings.
However, these businesses (and their stock prices) often stay small because their subscale operations make it harder to expand their competitive moats.
Let’s dig into the relative performance of Papa John's (NASDAQ:PZZA) and its peers as we unravel the now-completed Q1 traditional fast food earnings season.
As the Q1 earnings season wraps, let’s dig into this quarter’s best and worst performers in the traditional fast food industry, including Domino's (NASDAQ:DPZ) and its peers.
Shares of fast-food chain Arcos Dorados (NYSE:ARCO)
fell 6.1% in the morning session after the company reported weak first quarter 2025 results: Its same-store sales missed and its revenue fell short of Wall Street's estimates.
Fast-food chain Arcos Dorados (NYSE:ARCO) fell short of the market’s revenue expectations in Q1 CY2025, with sales flat year on year at $1.08 billion. Its GAAP profit of $0.07 per share was 30% below analysts’ consensus estimates.
