The business behind the dividend
| Measure | ARCO | Median | Formula |
|---|---|---|---|
| Return on equity | 27.5% | 10.6% | Net income ÷ shareholders’ equity |
| Return on capital employed | 19.1% | 10.0% | Operating income ÷ (equity + total debt) |
| Owner earnings | $128.02m | $120.90m | Net income + depreciation & amortisation − capital expenditure |
| Free cash flow | $14.99m | $155.08m | Operating cash flow − capital expenditure |
| Operating margin | 7.8% | 14.3% | Operating income ÷ revenue |
| Net margin | 4.5% | 10.1% | Net income ÷ revenue |
| Debt to equity | 1.48x | 0.73x | Total debt ÷ shareholders’ equity |
| Interest cover | 26.68x | 4.22x | Operating income ÷ interest expense |
| Current ratio | 1.03x | 1.55x | Current assets ÷ current liabilities |
| Long-term debt to working capital | 48.48x | 1.88x | Long-term debt ÷ (current assets − current liabilities) |
| Cash conversion | 1.40x | 1.66x | Operating cash flow ÷ net income |
| Accruals | -2.2% | -3.1% | (Net income − operating cash flow) ÷ total assets |
Ten years of it
The same measures, for every year the filings support. One year is a fact; a row is a business.
| Measure | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | Median |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Return on equity | 27.5% | 29.3% | 35.2% | 43.4% | 20.6% | -75.7% | 19.0% | 9.4% | 26.1% | 22.5% | 22.5% |
| Return on capital employed | 19.1% | 26.5% | 25.5% | 25.1% | 14.5% | -6.9% | 15.3% | 12.1% | 24.2% | 19.2% | 19.1% |
| Operating margin | 7.8% | 7.3% | 7.2% | 7.3% | 5.2% | -3.4% | 5.4% | 4.0% | 8.2% | 6.1% | 6.1% |
| Net margin | 4.5% | 3.3% | 4.2% | 3.9% | 1.7% | -7.5% | 2.7% | 1.2% | 3.9% | 2.7% | 2.7% |
| Debt to equity | 1.48x | 1.41x | 1.39x | 2.26x | 3.38x | 3.93x | 1.49x | 1.61x | 1.28x | 1.65x | 1.49x |
| Current ratio | 1.03x | 0.61x | 0.72x | 0.90x | 0.87x | 0.83x | 0.68x | 0.94x | 1.08x | 0.81x | 0.83x |
| Cash conversion | 1.40x | 1.79x | 2.11x | 2.46x | 5.67x | — | 2.80x | 4.88x | 1.98x | 2.08x | 2.11x |
How it compares in consumer discretionary
Among the 169 consumer discretionary companies here measured on free cash flow, Arcos Dorados Holdings pays out less than 3 of them. The median for that group is 33.1%, against this company’s 337.2%.
Closest on free cash flow
- Park Hotels & Resorts (PK) 274.5%
- Whirlpool (WHR) 370.4%
- Oxford Industries (OXM) 372.6%
- National CineMedia (NCMI) 407.1%
Same sector and same denominator, so the figures are comparable. All 197 in consumer discretionary →