Arcos Dorados Holding Inc (ARCO) Earnings: An Early Look

However, competitors are using Arcos Dorados’ playbook against it. Burger King Worldwide Inc (NYSE: BKW) recently created a joint venture with franchisee Beboca called BK Centro America, which will allow Burger King restaurants throughout the six nations of Central America. Given the success that Arcos has had in South America, Burger King may look for a similar deal there in the future.

One tough situation Arcos Dorados faces is in Venezuela, where recent currency devaluations have now been followed by the death of leader Hugo Chavez. With Arcos Dorados Holding Inc (NYSE:ARCO) getting nearly 9% of its earnings from Venezuela in the first half of 2012, instability there could prove to be problematic for the franchisee.

In its quarterly report, look for Arcos Dorados to talk about the long-term economic impact of coming global sporting events in Brazil, including the 2014 World Cup and 2016 Olympics. They may seem a long way off, but preparing for all the attention that Brazil will get over the next several years could be critical for Arcos Dorados to build a favorable reputation from the events.

The article Arcos Dorados Earnings: An Early Look originally appeared on Fool.com and is written by Dan Caplinger.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Burger King Worldwide (NYSE:BKW) and McDonald’s. The Motley Fool owns shares of Arcos Dorados and McDonald’s.

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