Arcos Dorados Holdings Inc (ARCO)vsDarden Restaurants Inc (DRI)
ARCO
Arcos Dorados Holdings Inc
$7.94
-0.87%
CONSUMER CYCLICAL · Cap: $1.70B
DRI
Darden Restaurants Inc
$218.57
+4.14%
CONSUMER CYCLICAL · Cap: $24.18B
Smart Verdict
WallStSmart Research — data-driven comparison
Darden Restaurants Inc generates 165% more annual revenue ($13.21B vs $4.98B). DRI leads profitability with a 9.1% profit margin vs 5.2%. ARCO appears more attractively valued with a PEG of 0.54. ARCO earns a higher WallStSmart Score of 72/100 (B).
ARCO
Strong Buy72
out of 100
Grade: B
DRI
Strong Buy67
out of 100
Grade: B-
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
+28.2%
Fair Value
$11.71
Current Price
$7.94
$3.77 discount
Margin of Safety
-86.7%
Fair Value
$113.99
Current Price
$218.57
$104.58 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 99.3% YoY
Growing faster than its price suggests
Reasonable price relative to book value
Every $100 of equity generates 55 in profit
Earnings expanding 36.0% YoY
Areas to Watch
Grey zone — moderate risk
Smaller company, higher risk/reward
5.2% margin — thin
Elevated debt levels
Expensive relative to growth rate
Trading at 11.3x book value
Negative free cash flow — burning cash
Distress zone — elevated risk
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 14.3% demonstrates continued momentum. PEG of 0.54 suggests the stock is reasonably priced for its growth.
Bull Case : DRI
The strongest argument for DRI centers on Return on Equity, EPS Growth. Revenue growth of 13.7% demonstrates continued momentum.
Bear Case : ARCO
The primary concerns for ARCO are Altman Z-Score, Market Cap, Profit Margin. Debt-to-equity of 2.65 is elevated, increasing financial risk.
Bear Case : DRI
The primary concerns for DRI are PEG Ratio, Price/Book, Free Cash Flow. Debt-to-equity of 2.74 is elevated, increasing financial risk.
Key Dynamics to Monitor
DRI carries more volatility with a beta of 0.59 — expect wider price swings.
ARCO is growing revenue faster at 14.3% — sustainability is the question.
ARCO generates stronger free cash flow (56M), providing more financial flexibility.
Monitor RESTAURANTS industry trends, competitive dynamics, and regulatory changes.
Bottom Line
ARCO scores higher overall (72/100 vs 67/100) and 14.3% revenue growth. Both earn "Strong Buy" and "Strong 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 →Darden Restaurants Inc
CONSUMER CYCLICAL · RESTAURANTS · USA
Darden Restaurants, Inc. is an American multi-brand restaurant operator headquartered in Orlando.
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