Ruy Hungary continues to invest in the sector, but makes adjustments to capture gains (Images: Flávya Pereira/Money Times)
After nailing the choice of Direcional (DIRR3) for September's monthly dividend portfolio, Ruy Hungaryequity analyst at Empiricus Research, makes a strategic change to the recommended portfolio for the month of October: Direcional leaves (DIRR3) and Cyrela enters (CYRE3).
In September, Direcional rose 5% following an announcement of a million-dollar dividend payment:
Despite the good performance, in Hungary's view, the time is now to make this profit and seek dividends with another action in the construction sector.
“We will take advantage of this positive performance of DIRR3 (in September) to remove the shares from the portfolio and insert Cyrela (CYRE3), which suffered a lot in the month and already seems to have a lot pessimism priced in at this moment”, explained Ruy.
Direcional (DIRR3) leaves and Cyrela (CYRE3) enters the October dividend portfolio
In a recent interview with the program Onde Investir, Ruy Virgínia explained the basis for this tactical change in the October dividend portfolio.
“Os differentiated productsone above average operational performance, enormous financial discipline and costsin addition to maintaining focus on the areas where the company had greater expertise make Cyrela stand out from the majority”, summarized Ruy.
Furthermore, Cyrela (CYRE3) is known to maintain a robust dividend policywith frequent payments to its shareholders even in more challenging times of high interest rates, which make financing for property purchases difficult.
Finally, Cyrela shares (CYRE3) are trading at a P/E multiple of 5.7 times expected for 2025, a number considered quite attractive in the analyst's opinion, opening a window of opportunity to compose the dividend portfolio.
On the program, Ruy also explained that, unlike companies in the growth stage, good dividend payers tend to be less impacted by the rise in the Selic rate for a few reasons:
- In general, they have a more predictable and stable cash flowwhich makes them more resilient in high interest rate environments;
- Tend to maintain a more conservative debt profileprecisely to preserve the cash flow necessary to support the distribution of dividends. With less debt, these companies are less impacted by the rise in financing costs, which increase along with the Selic rate.
Furthermore, when the Selic rises, investors seek higher returns in lower-risk assets, such as government bonds. However, companies like Cyrela (CYRE3) remain attractive because they already offer a consistent and regular paysimilar to these investments but with the additional potential of share value growth.
Dividends and more: where to invest in October
In addition to Cyrela (CYRE3), Ruy Virgínia selected others four actions of companies from different economic sectors to form a portfolio for dividend investors who seek superior returns in the long term.
“These are mature companies, inserted in large markets, with solid balance sheets, resilient business models, high levels of liquidity of their shares and a good margin of safety (valuation and carry levels)”, explained the analyst.
In addition to the dividend portfolio, you can also have access to top picks from Empiricus analysts across different asset classes: Brazilian shares, real estate funds and international shares (BDRs).
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