Arcos Dorados Holdings Inc (ARCO)vsMcDonald’s Corporation (MCD)
ARCO
Arcos Dorados Holdings Inc
$8.20
-0.73%
CONSUMER CYCLICAL · Cap: $1.83B
MCD
McDonald’s Corporation
$279.84
+0.01%
CONSUMER CYCLICAL · Cap: $196.36B
Smart Verdict
WallStSmart Research — data-driven comparison
McDonald’s Corporation generates 470% more annual revenue ($27.45B vs $4.82B). MCD leads profitability with a 31.6% profit margin vs 4.9%. ARCO appears more attractively valued with a PEG of 0.54. ARCO earns a higher WallStSmart Score of 70/100 (B-).
ARCO
Strong Buy70
out of 100
Grade: B-
MCD
Buy55
out of 100
Grade: C-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
+25.8%
Fair Value
$11.33
Current Price
$8.20
$3.13 discount
Margin of Safety
-85.8%
Fair Value
$150.63
Current Price
$279.84
$129.21 premium
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Attractively priced relative to earnings
Every $100 of equity generates 30 in profit
Earnings expanding 159.4% YoY
Growing faster than its price suggests
Reasonable price relative to book value
Keeps 32 of every $100 in revenue as profit
Strong operational efficiency at 44.3%
Conservative balance sheet, low leverage
Large-cap with strong market position
Generating 1.7B in free cash flow
Areas to Watch
Grey zone — moderate risk
Smaller company, higher risk/reward
4.9% margin — thin
Negative free cash flow — burning cash
ROE of 0.0% — below average capital efficiency
Weak financial health signals
Expensive relative to growth rate
Comparative Analysis Report
WallStSmart ResearchBull Case : ARCO
The strongest argument for ARCO centers on P/E Ratio, Return on Equity, EPS Growth. Revenue growth of 12.9% demonstrates continued momentum. PEG of 0.54 suggests the stock is reasonably priced for its growth.
Bull Case : MCD
The strongest argument for MCD centers on Profit Margin, Operating Margin, Debt/Equity. Profitability is solid with margins at 31.6% and operating margin at 44.3%.
Bear Case : ARCO
The primary concerns for ARCO are Altman Z-Score, Market Cap, Profit Margin. Debt-to-equity of 2.82 is elevated, increasing financial risk. Thin 4.9% margins leave little buffer for downturns.
Bear Case : MCD
The primary concerns for MCD are Return on Equity, Piotroski F-Score, PEG Ratio.
Key Dynamics to Monitor
ARCO profiles as a value stock while MCD is a mature play — different risk/reward profiles.
ARCO carries more volatility with a beta of 0.48 — expect wider price swings.
ARCO is growing revenue faster at 12.9% — sustainability is the question.
MCD generates stronger free cash flow (1.7B), providing more financial flexibility.
Bottom Line
ARCO scores higher overall (70/100 vs 55/100) and 12.9% revenue growth. Both earn "Strong Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
Arcos Dorados Holdings Inc
CONSUMER CYCLICAL · RESTAURANTS · USA
Arcos Dorados Holdings Inc. is a McDonald's restaurant franchise. The company is headquartered in Montevideo, Uruguay.
Visit Website →McDonald’s Corporation
CONSUMER CYCLICAL · RESTAURANTS · USA
McDonald's Corporation is an American fast food company, founded in 1940 as a restaurant operated by Richard and Maurice McDonald, in San Bernardino, California, United States. They rechristened their business as a hamburger stand, and later turned the company into a franchise, with the Golden Arches logo being introduced in 1953 at a location in Phoenix, Arizona.
Visit Website →Compare with Other RESTAURANTS Stocks
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