BTG Pactual reiterates its buy recommendation for Vibra Energia (Photo: Vibra/Disclosure)
O BTG Pactual reiterated the recommendation of buy for the Vibrate Energy (VBBR3), with a new target price of R$35, compared to R$34. The company is the bank's favorite in the fuel distribution sector.
Following the announcement of the acquisition of the remaining 50% stake in Comerc for R$3.5 billion, the bank's analysts point to a reluctance among investors to pay for Comerc's long-term appreciation potential, given the preference for payments of dividends higher.
- Neymar's loss: cryptocurrencies purchased by the player melt 90% in two years and expert explains: “merely speculative assets”; find out more
In BTG’s assessment, the likelihood of payouts exceeding Vibra’s 40% profit distribution policy has diminished, although not completely. With the cost of capital still high in Brazil, it says, trading short-term cash returns for long-term options on projects beyond the company’s historical experience may seem questionable.
“Even assuming that the price paid for VBBR is significantly above Comerc’s fair NAV (net asset value), the fuel distribution arm remains undervalued, supporting our positive view,” they say.
Vibra Energia moves forward and buys the remainder of Comerc
At the end of August, Vibra, which already held a 50% stake in Commerce Since 2021, it has decided to move forward and exercise the right to purchase an additional 50% of the company, which operates in the free energy market. The expectation was that the business would turn around from 2026.
According to Vibra, the company has low operational risk after a growth cycle. In 2021, in the initial acquisition, it was valued at approximately R$6.80 billion, a value that, adjusted by the CDI, would be equivalent to approximately R$9.24 billion.
Founded in 2001 to manage free market consumers and operate in energy sales, Comerc has 4,700 consumer units and solar generation parks with 78 solar plants in operation.
It is the largest energy manager in Brazil, measures more than 27 thousand telemetry points and develops carbon inventories.
BTG comments that, although it has already incorporated the net fair equity value (NAV) for Vibra's approximately 50% stake in Comerc into VBBR's target price for some time, it is taking advantage of the recent agreement to include a comprehensive and more conservative modeling in the bank's consolidated model, adding Comerc's results to VBBR's P&L (profits and losses) from 2025 onwards.
For the house, the fair NAV is R$6.1 billion, versus R$3.85 billion with the 50% stake previously, implying a 21% drop with 100% stake. Working Interest (WI).
“We expect Comerc’s profit in 2025 to be close to zero, while cash flow generation is estimated at R$362 million in 2026. But the gradual growth of operations, together with the normalization of future investments, should contribute to deleveraging soon.”
BTG sees potential for appreciation
For BTG, Vibra's management will remain focused on its core business of fuel distribution, even amid the challenges inherent to a company developing a new business unit. For the bank, the risks associated with the investment thesis are more than priced in.
- Neither PETR4 nor BRAV3: BTG Pactual's oil “main sector choice” is another; see here
“With strong visibility of the results at least until the 2026 presidential elections, we see potential for VBBR to appreciate.”
BTG also raised its 2025 EBITDA (earnings before interest, taxes, depreciation and amortization) estimates to 8% above consensus.
The “sum of the parts”, considering the cash flow for the fuel distribution and Comerc segment, justifies the target price of R$35 per share, implying a potential return of 44% and a target price-to-earnings (P/E) of 14x.
“The stock currently trades at 9.5x P/E for 2025, and while one could argue that a P/E closer to 14x may seem high, if Vibra narrows the multiple gap with its closest peer (currently trading at 12.8x P/E for 2025), the potential return more than supports our Buy recommendation.”
*With Renan Dantas