Arcos Dorados HoldingsBSP:A1RC34 64 ROE % is 18.31% as of Mar. 2026, which is 32% below its 10-year median of 26.90. GuruFocus rates BSP:A1RC34 with a GF Score™ of 64/100 and a GF Value™ of R$48.23 (Fairly Valued). The stock has 6 warning signs investors should review. Among 343 Restaurants companies, Arcos Dorados Holdings ranks better than 90.09% on this metric.
ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.
The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:
Note:
The net income data used here is four times the quarterly (Mar. 2026) net income data. The Revenue data used here is four times the quarterly (Mar. 2026) revenue data. The same rule applies to Pre-Tax Income and Operating Income.
* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Be Aware
Net Income is used.
Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their ROE %s can be extremely high.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Restaurants subindustry, Arcos Dorados Holdings's ROE %, along with its competitors' market caps and ROE % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Arcos Dorados Holdings ROE % vs Restaurants Industry
For the Restaurants industry and Consumer Cyclical sector, Arcos Dorados Holdings's ROE % distribution charts can be found below:
* The bar in red indicates where Arcos Dorados Holdings's ROE % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual ROE %, the net income of the last fiscal year and the average total shareholder equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Mar. 2026) net income data.
ROE % is displayed in the 30-year financial page.
Arcos Dorados Holdings (BSP:A1RC34) has a ROE % of 18.31% as of Mar. 2026. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Arcos Dorados Holdings and its competitors. This is 32% below median its historical median of 26.90. According to the industry distribution chart, Arcos Dorados Holdings ranks #34 out of 343 companies in the Restaurants industry, placing it in the top 9.9%.
Is Arcos Dorados Holdings' ROE % too high?
Arcos Dorados Holdings' current ROE % of 18.31% is 32% below median its 10-year median of 26.90. The Restaurants industry median ROE % is 6.56. Arcos Dorados Holdings' value of 18.31% is 179.1% above this industry median. Based on the distribution chart, Arcos Dorados Holdings ranks #34 out of 343 companies in the Restaurants industry, which is in the top quartile — a strong position relative to peers. Overall, Arcos Dorados Holdings has a GF Score™ of 64/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Arcos Dorados Holdings' ROE % compare to WEN and BH?
According to the Restaurants industry distribution chart, Arcos Dorados Holdings ranks #34 out of 343 companies for ROE %. This places Arcos Dorados Holdings in the top 10% of its industry — outperforming the majority of peers. The industry median ROE % is 6.56. Arcos Dorados Holdings' value of 18.31% is 179.1% above this benchmark. While the company's 10-year median is 26.90 vs. the industry median of 6.56, Arcos Dorados Holdings has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROE % for a Restaurants company?
The median ROE % among Restaurants companies is 6.56, based on 343 companies in the industry. Companies in the top quartile (top 25%) have a ROE % significantly above this median, while those in the bottom quartile fall well below. However, ROE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Arcos Dorados Holdings's current ROE % of 18.31% is 179.1% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROE % mean?
A high ROE % can signal that a stock is expensive relative to its fundamentals. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on Arcos Dorados Holdings and its competitors. For the Restaurants industry, the median ROE % is 6.56 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Arcos Dorados Holdings's current ROE % is 18.31%, which is 32% below median its own 10-year median of 26.90. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Arcos Dorados Holdings stock overvalued right now?
Based on GuruFocus' analysis, Arcos Dorados Holdings (BSP:A1RC34) is currently considered Fairly Valued. The stock's GF Value™ is R$48.23, compared to a current price of R$42.00 — trading 12.9% below its estimated fair value. The current ROE % is 18.31%, which is 32% below median its 10-year median of 26.90 and 179.1% above the Restaurants industry median of 6.56. Arcos Dorados Holdings' overall GF Score™ is 64/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROE % calculated?
ROE % is calculated from a company's financial statements. For Arcos Dorados Holdings (BSP:A1RC34), the current ROE % is 18.31% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Arcos Dorados Holdings (BSP:A1RC34) Overvalued in 2026?
Based on GuruFocus' analysis, Arcos Dorados Holdings stock appears to be undervalued.
The current stock price of R$42.00 is trading 12.9% below its estimated GF Value™ of R$48.23.
GuruFocus considers Arcos Dorados Holdings to be Fairly Valued.
Key valuation signals for BSP:A1RC34:
ROE %: 18.31% (32% below median its 10-year median of 26.90)
GF Value™: R$48.23 vs. price of R$42.00 (12.9% below fair value)
Industry Position: 179.1% above the Restaurants median (#34 of 343)
No single metric tells the full story. See the BSP:A1RC34 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Arcos Dorados Holdings Inc operates McDonald's branded restaurants in various countries and territories in Latin America and the Caribbean. The Company manages its business as distinct geographic segments and its operations are divided into three geographic divisions, as follows: Brazil, the North Latin American division, or NOLAD, which is comprised of Costa Rica, Mexico, Panama, Puerto Rico, Martinique, Guadeloupe, French Guiana and the U.S. Virgin Islands of St. Croix and St. Thomas and the South Latin American division, or SLAD, which is comprised of Argentina, Chile, Ecuador, Peru, Uruguay, Colombia, Venezuela, Trinidad and Tobago, Aruba and Curacao. Its menu includes hamburgers, McNuggets, salad, sandwiches, French fries, and others. It generates maximum revenue from Brazil.
64GF Score
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