MeritValue

Arcos Dorados Holdings Inc.

ARCOdata completeness 100%17 fiscal years on file

Data notes: no data for concept 'investmentsAtFairValue'; no data for concept 'netInvestmentIncome'; no data for concept 'gainsOnRealEstateSales'; no data for concept 'realEstateImpairment'

The thesis, from the filings

Arcos Dorados Holdings Inc. earns about 16% on invested capital, with a roughly flat share count. The applicable estimate puts fair value near $7.25 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$2.66B1$3.62B2$4.33B3$4.47B3$4.68B3
Net income$45.5M4$140.3M5$181.3M6$148.8M6$212.1M6
Operating cash flow$258M7$345.4M8$382M9$266.8M9$296.3M9
Capital expenditure$115M10$217.1M11$360.1M12$327.6M12$281.4M12
Free cash flow (derived)$143M7$128.3M8$21.9M9−$60.8M9$15M9
Total debt$744M13$731M14$744.4M15$778.8M16$1.14B16
Cash & equivalents$278.8M17$266.9M18$196.7M19$135.1M20$373.4M20
Diluted shares210.5M210.6M210.6M210.7M210.7M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$36.57
your share of equity
Profit it earned you last year
$10.07
Free cash flow it threw off
$0.71
Debt you’d be carrying
$54

10 shares is a claim on $36.57 of net worth that earned you $10.07 and generated $0.71 of cash last year, against $54 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
16% avg · 5y
FY21 11%FY22 21%FY23 19%FY24 15%FY25 14%

It earned an average 16% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+0% shares · 5y

Share count is roughly flat over 5 years — little dilution, little buyback. Total debt has risen 53% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.5.0
DCF · Growth Exit 10Y
not applicable
negative equity value — refusing to publish per-share figure
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$15M
DCF · Growth Exit 5Y
not applicable
negative equity value — refusing to publish per-share figure
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$15M
Earnings Power Value
$7.25
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$148.8M
  • growthAssumed0.0%
Graham Number
$9.12
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 20-F · period ending 2021-12-31 · accession 0001628280-24-019077 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 20-F · period ending 2022-12-31 · accession 0001628280-25-020727 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 20-F · period ending 2023-12-31 · accession 0001628280-26-028950 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 20-F · period ending 2021-12-31 · accession 0001628280-24-019077 (NetIncomeLoss)
  5. 20-F · period ending 2022-12-31 · accession 0001628280-25-020727 (NetIncomeLoss)
  6. 20-F · period ending 2023-12-31 · accession 0001628280-26-028950 (NetIncomeLoss)
  7. 20-F · period ending 2021-12-31 · accession 0001628280-24-019077 (NetCashProvidedByUsedInOperatingActivities)
  8. 20-F · period ending 2022-12-31 · accession 0001628280-25-020727 (NetCashProvidedByUsedInOperatingActivities)
  9. 20-F · period ending 2023-12-31 · accession 0001628280-26-028950 (NetCashProvidedByUsedInOperatingActivities)
  10. 20-F · period ending 2021-12-31 · accession 0001628280-24-019077 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 20-F · period ending 2022-12-31 · accession 0001628280-25-020727 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 20-F · period ending 2023-12-31 · accession 0001628280-26-028950 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 20-F · period ending 2021-12-31 · accession 0001628280-23-014221 (LongTermDebtNoncurrent)
  14. 20-F · period ending 2022-12-31 · accession 0001628280-24-019077 (LongTermDebtNoncurrent)
  15. 20-F · period ending 2023-12-31 · accession 0001628280-25-020727 (LongTermDebtNoncurrent)
  16. 20-F · period ending 2024-12-31 · accession 0001628280-26-028950 (LongTermDebtNoncurrent)
  17. 20-F · period ending 2021-12-31 · accession 0001628280-23-014221 (CashAndCashEquivalentsAtCarryingValue)
  18. 20-F · period ending 2022-12-31 · accession 0001628280-24-019077 (CashAndCashEquivalentsAtCarryingValue)
  19. 20-F · period ending 2023-12-31 · accession 0001628280-25-020727 (CashAndCashEquivalentsAtCarryingValue)
  20. 20-F · period ending 2024-12-31 · accession 0001628280-26-028950 (CashAndCashEquivalentsAtCarryingValue)