2024-04-07 21:00:31
Investing.com – Nothing unanimous. Analysts from banks and analysis houses had mixed views on the fourth quarter 2023 earnings season for shares listed on B3 (BVMF:), according to the companies they cover.
BB Investimentos considered the season to be positive, Órama assessed it as in line with expectations and XP Investimentos (BVMF:) as negative, despite marginal improvements. For Bank of America (NYSE:) (BofA), there was a lack of positive surprises, while BTG assesses that, in the annual comparison, the data was solid.
Jennie Li, strategist at XP Investimentos, assesses that the season was not so positive, especially when compared to seasons in international markets such as the United States. “Data from Bloomberg show that 75% of S&P companies beat market analysts’ estimates, while for the S&P, the percentage was 45%, with fewer companies beating consensus estimates,” she compares.
See what financial institutions assess as highlights of the fourth quarter earnings season for companies listed on B3:
Projections of earnings per share (LPA) and revenue for Petrobras, Vale and other companies can be checked on the InvestingPro platform, as well as the complete history of results and comparison of companies in relation to their peers.
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BB
According to BB Investimentos, the earnings season was predominantly positive. “We noticed, in general, less harmful effects of inflation on companies’ costs. There was a stabilization movement and gradual improvement in margins in the wake of the decompression of interest rates, supported by a credit market that was recovering”, assesses BB in a report.
BB mentions as an exception the more cyclical theses, which require a more robust expansion, which did not occur in the last three months of the year given the competitive scenario and pressure on margins.
BofA
Bank of America (BofA) pointed out, in a report, that the fourth quarter earnings season would have demonstrated expansion in earnings per share, “but lacks positive surprises”. “We saw second quarter annual EPS expansion in Ibov ex-commodities, but a limited number of beats suggest good news may already be priced in.”
The bank listed the shopping malls, telecommunications and education sectors as positive highlights, while banks, retail, capital goods, food, industries and public services had mixed results.
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BTG
BTG Pactual (BVMF:) considers that, at first glance, the results, disregarding Petrobras (BVMF:) Vale (BVMF:), appear smooth, with revenues 3.0% above its analysts’ projections, Ebitda and profits 1 .1% and 7% below our estimates, respectively.
However, in comparison with the fourth quarter of the previous year, the data was solid, with an increase in revenue of 1.8%, in EBITDA of 12.2% and in net profit of 19.4%. “Excluding food and beverage companies, which were the main negative driver of domestic results, the numbers would have been even stronger, with revenue, Ebitda and net profit increasing 7%, 19% and 26% per year”, highlights BTG.
Raw materials exporters presented mixed data, according to the bank, with consolidated results with an annual drop of 7.2% in revenue, a 22.7% decrease in profit and a 4.5% increase in EBITDA, considering the base Yearly.
Orama
The results season was very much in line with the previous quarter, in Órama’s opinion. “In commodities, with the price of iron ore more or less in the same range, at US$100 to US$130, Vale was more or less at the same level, we had oil still at US$80 to US$80, so Petrobras and junior oils had robust results”, highlights Phil Soares, head of stock analysis at Órama.
“In retail, consumption was very much in line, of course adjusting for the seasonality at the end of the year. Saúde came with a lot of outliers, Hapvida (BVMF:), Oncoclinics plummeting”, adds the analyst, mentioning negative repercussions also for Minerva (BVMF:).
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XP
In XP’s coverage, 30% of companies beat analysts’ Ebitda estimates, 47% came in line and 24% below. Considering profits, 53% exceeded XP analysts’ projections, 15% were in line and 33% below.
The season was not positive, still with a contraction in profits, but it continues the movement that was noticed in previous quarters that indicate possible improvements to come. “However, I would say that we started to see a marginal improvement, especially in some stocks and sectors that have been under a lot of pressure from the very challenging domestic macro”, ponders Jennie Li.
The outlook for 2024 has also improved, according to the strategist. Ibovespa earnings per share market estimates have been revised upwards by 10% in the last six months, with better macro, including disinflation and a downward trajectory in interest rates.
Meanwhile, in a report, XP states that the quarter was one of weak data for grain producers, reflecting lower commodity prices and rising costs. The capital market sector has shown signs of improvement, albeit slowly, according to XP, which states that 2023 indicates a turning point for neobanks. Construction companies presented positive results for Cury, Direcional (BVMF:) and Plano & Plano, while MRV (BVMF:), Tenda (BVMF:) and Even (BVMF:) were on the negative side. In electrical and sanitation, XP lists Eletrobras (BVMF:) and Sabesp (BVMF:) as the best data, while shopping malls would have presented robust operational performance. In retail, Grupo Soma (BVMF:) and C&A would have stood out compared to the others, while food retail was affected by the disinflationary trend. Magalu reportedly reported improved margins and solid cash generation, while Casas Bahia continues to face costs from its restructuring.
Levante
Flavio Conde, an analyst at Levante, recalls that, in the fourth quarter of 2022, prices of oil, steel, cellulose and paper were at record levels and, during 2023, they began to fall. “Thus, Petrobras, Usiminas (BVMF:), Gerdau (BVMF:), Suzano (BVMF:), Klabin (BVMF:) and Irani had an annual drop in results, be it revenue, EBITDA and net profit. On average, there is also a worsening of the financial result.” The exception was the iron ore sector, due to the Chinese economy, with improved prices. The fourth quarter was the worst of the year, but not for junior companies, which had been investing in production growth, being less affected by oil prices, in Conde’s opinion.
In the banking sector, Banco do Brasil (BVMF:) and Itaú presented better results in 2023, with profits of almost R$10 billion, considered very high by the analyst, in addition to a Return on Equity (ROE) of 21%. On the other hand, Bradesco (BVMF:) and Santander (BVMF:) “took a dive” in the fourth quarter. Both had been improving and got worse again, unexpectedly, in the analyst’s opinion, a strong disappointment.
The negative surprise of the quarter was Bradesco, while the positive one was the insurance sector, with emphasis on BB Seguridade (BVMF:). “In addition to it, Caixa and Porto, all came with growth in their revenue lines, with a drop in expenses and everything growing”.
In retail, the negative highlight was Casas Bahia, “which continues in its process of shrinking and producing negative results”, laments Conde, who considers that Magazine Luiza (BVMF:) presented good numbers, surprising positively, even though the their actions remain penalized. C&A, Grupo Soma, Arezzo (BVMF:) and Vivara (BVMF:) also reported good numbers, in the analyst’s opinion.
For the next season, Conde expects the data to be “more of the same”, with concerns regarding retail, given that the first three months of the year tend to be weaker due to seasonality.
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