ARCO Gears Up for Q1 Earnings: What's in the Offing for the Stock?

Core Viewpoint - Arcos Dorados Holdings Inc. (ARCO) is expected to report first-quarter 2025 results on May 14, 2025, with earnings anticipated to be below the previous year's performance due to various macroeconomic challenges and increased operational costs [1][3][5]. Group 1: Earnings Estimates - The Zacks Consensus Estimate for ARCO's earnings is set at 13 cents per share, reflecting a 7.1% decline year over year [2]. - Revenue estimates for the quarter are pegged at $1.07 billion, indicating a 1.3% decrease compared to the previous year [2]. Group 2: Factors Impacting Performance - The expected softness in comparable sales growth is attributed to macroeconomic headwinds and shifts in consumer sentiment, particularly affecting consumer-facing businesses in Latin America [3]. - A tougher year-over-year benchmark due to a leap year and weaker currency levels in core markets are anticipated to negatively impact performance [4]. - High operational costs, driven by investments in digital and IT infrastructure, are likely to have further pressured the bottom line [5]. Group 3: Earnings Prediction Model - The current model does not predict an earnings beat for ARCO, as it has an Earnings ESP of 0.00% and a Zacks Rank of 3 (Hold) [6][7].