15 Best Beaten Down Stocks to Invest In

7) Arcos Dorados Holdings Inc. (NYSE:ARCO)

% Decline on a YTD Basis: ~34.3%

Number of Hedge Fund Holders: 19

Arcos Dorados Holdings Inc. (NYSE:ARCO) is a franchisee for an American fast-food burger restaurant. It has the right to own, operate, and grant franchises of restaurants in South and Central America and the Caribbean.

Arcos Dorados Holdings Inc. (NYSE:ARCO) has been facing challenges through market headwinds, including currency fluctuations and changing consumer spending patterns in its key markets. Furthermore, the company’s stock faced the impact of inflation-induced cost pressures on labor and raw materials.

However, Wall Street analysts opine that the current juncture of Arcos Dorados Holdings Inc. (NYSE:ARCO)’s stock provides an entry point. On 1^st October 2024, the company announced that it will exercise its option to renew its Master Franchise Agreement (MFA) with McDonald’s for another 20 years starting in 2025. This agreement further strengthens its strategic footing, which stems from the geographic diversification of its solid restaurant base throughout Latin America.

As per Moody’s Ratings, the company’s competitive edge is aided by its restaurant portfolio. This is because around half of its restaurants are free-standing units, which provide a mix of takeout, drive-thru, and delivery service options. These options enhance restaurant sales. Furthermore, Arcos Dorados Holdings Inc. (NYSE:ARCO) is hedging food and paper costs at 50% of projected exposure throughout 5 markets to reduce the volatility of its input costs.

As per Wall Street, the shares of Arcos Dorados Holdings Inc. (NYSE:ARCO) have an average price target of $13.0.