BTG projects an EBITDA of R$35 billion for JBS in 2024, in line with the midpoint of the guidance (Image: Disclosure)
O BTG Pactual (BPAC11) raised its price target for the company's stock JBS (JBSS3) from R$47 to R$48, maintaining its purchase recommendation.
The bank revised its estimates for the slaughterhouse, according to the guidance recently released. BTG now projects an Ebitda of R$35 billion for 2024, in line with the midpoint of its guidance (8% above previous estimates and 6% above consensus), driven by better expectations for the poultry businesses (PPC and Seara).
“Negotiating with a yield cash flow growth of 14% this year and in a market that favors momentum-driven stories, we believe that JBS shares offer an attractive investment opportunity”, say Thiago Duarte, Guilherme Guttilla and Bruno Lima.
The main question now, according to analysts, is what the magnitude of the risk is. “JBS’s robust cash generation suggests that, even if pressure impacts share performance in the short term, the downside risk appears limited and the carry remains attractive,” they say.
JBSS3: The best risk-return in the sector
For the bank, JBS presents the best risk-return relationship in the protein sector, being the only stock with a buy recommendation.
This scenario is also supported by the company's commitment to returning part of the cash flow to shareholders, as evidenced by the strong dividend following the second quarter results and the recent announcement of the R$3.6 billion buyback plan, totaling R$8 millions in shareholder return announcements this year alone.
“The story of deleveraging remains very well established. With the guns firing, we believe now is the time to buy”, you see.
According to BTG, the main uncertainty is the possible sale by BNDES of its stake in the meatpacking plant, which has created pressure on shares.
“We believe that selling part of its stake makes sense. Although market players generally avoid uncertainty, it can sometimes present opportunities. In this case, we believe that excess uncertainty is one of the main factors behind the recent underperformance of JBS shares, potentially creating an attractive entry point.”