(iStock.com/Dragos Cojocari)
O JP Morgan revised its estimates to BRF (BRFS3) e JBS (JBSS3) for the tenth consecutive time, as analysts project that the companies will continue to maintain good momentum in the second half of the year, especially in the third quarter, due to strong spreads in most business units, solid demand and tight supply.
BRF shares closed up 4.2% and JBS shares rose 0.43%.
As a result, estimates for EBITDA for BRF (R$3.108 billion) and JBS (R$35.506 billion) are 23% and 13% above market consensus, respectively.
“Despite seeing earnings peak now in the second half, we think momentum is positive, with no relevant signs of a major oversupply in protein, other than a seasonal slowdown in US chicken and beef. BRF is trading at 4.9x 2 EV/Ebitda and 13.5% FCF yield, while JBS is at 4.5x and 17.4%,” see Lucas Ferreira and Froylan Mendez.
- Unveiling Small Caps market strategies: free event on the 24th brings together a team of experts considered “Titans of the Market”; participate for free
While the bank raised BRF's target price to R$30 (compared to R$29) for December 2025, the institution maintained its target price of R$43 for JBS.
JP Morgan recommends buying (overweight) for the actions.
“We are increasing our estimates for BRF as we believe 2H24 margins will continue to expand, driven by higher prices in several markets, especially in Asia”
For JBS, JP updated the numbers after the introduction of the guidance for 2024.
“Despite weaker seasonality for Pilgrim's Pride and US beef, we expect JBS to post strong 2H24 numbers.”