ARCO

Zacks highlights five value stocks with attractive EV-to-EBITDA ratios as alternatives to traditional P/E-based valuation. The featured stocks—Ultrapar Participacoes, Chatham Lodging Trust, Arcos Dorados Holdings, Occidental Petroleum, and Kohl's—all carry Zacks Rank #1 or #2 ratings with Value Score A and show strong expected earnings growth for 2026.

Arcos Dorados (ARCO) is highlighted as a solid growth stock pick with a Zacks Growth Score of B and Rank #1. The company demonstrates exceptional earnings growth of 207.7% expected this year, efficient asset utilization with an S/TA ratio of 1.31 versus industry average of 1.07, and positive earnings estimate revisions, making it a potential outperformer for growth investors.

Arcos Dorados (ARCO) has gained 6.8% over the past four weeks and trades at $8.14. Wall Street analysts have set a mean price target of $10.71, suggesting a potential 31.6% upside.

The stock has received a Zacks Rank #1 (Strong Buy) rating, supported by positive earnings estimate revisions. However, the article cautions that price targets alone should not be the sole basis for investment decisions, as analysts often set overly optimistic targets.

The article discusses value investing strategies and highlights Arcos Dorados (ARCO) as an attractive value stock opportunity. ARCO holds a Zacks Rank #2 (Buy) with an 'A' Value grade, trading at a P/E ratio of 9.83 compared to its industry average of 19.89, suggesting the stock is undervalued with strong earnings outlook.

Zacks has added five stocks to its Rank #1 (Strong Buy) list based on increasing consensus earnings estimates over the last 60 days. The stocks include TDK Corp. (25.3% earnings estimate increase), Chord Energy Corporation (10.1% increase), Pebblebrook Hotel Trust (5.8% increase), Arcos Dorados (2.6% increase), and Limbach Holdings (0.9% increase).