Petrobras leads the ranking of favorite shares among 22 analysts for October (Image: REUTERS/Amanda Perobelli)
The beginning of the interest rate cut in USA (USA) and the resumption of the rise in the Selic rate in Brazil were the highlights of September. For the remainder of the year, the next moves by central banks — which remain uncertain — should remain in the spotlight.
The prospect of a continued monetary easing cycle in the US should continue to favor risk assets around the world, as long as it is not accompanied by a recession.
“If economic data continues to show a gradual cooling of activity and inflation, which remains the base scenario, we will have a desirable tailwind for our stock market”, says the analyst at Empiricus ResearchLarissa Quaresma.
As for the Brazilian scenario, the expansionist fiscal commands higher premiums in the interest curve, in addition to a potentially greater tightening than expected in the Selic. “Increasing interest rates, previously seen as a 'buy' of credibility from the new BC management, has become a more structural necessity, given inflationary pressures and fiscal stimulus for the economy”, says Quaresma.
- Read more: 2 triggers that could make the Brazilian stock market have an end-of-year “rally” and 10 stocks to invest in now, according to analyst; check it out here
The question for October is: what's in the price? The Empiricus analyst states that the “tightness” is already well priced, with the Ibovespa (IBOV) at around 132 thousand points, trading at a price-to-earnings multiple for 2025 of 9.5 times.
Furthermore, Quaresma says that, once the discussion surrounding the Bimonthly Income and Expense Report is over, there may be some relief this month. However, she considers that there are worrying signs surrounding the inspector.
What to buy in October?
A Petrobras (PETR3; PETR4) took the lead in ranking favorite stocks for the month of October. The state-owned company's shares received 15 recommendations, among the portfolios of 22 banks, brokers and analysis houses.
O Harvest — which even increased its exposure to Petrobras this month — believes that results will remain robust in the short and medium term and the company will maintain a good earnings distribution capacity.
Analysts also point out that the oil company offers an “attractive” valuation. “We see its shares trading at a discount in relation to their international peers and their historical average”, they state.
Already the Santander remember that, recently, it updated Petrobras' recommendation for purchase and raised the target price to R$54, based on a more optimistic outlook for the capital structure and, therefore, potential for extraordinary dividends.
“We believe that Petrobras' Strategic Plan (PE) 2025-29, normally released in the 4th quarter, could make the company's capital structure more flexible, potentially through: an adjustment to the gross debt ceiling and more clarity on the cash position minimum. Furthermore, we also believe that the new PE could potentially include a reduced Capex for 2025.”
Analysts incorporated US$3.5 billion in extraordinary dividends, taking the expected dividend yield for 2025 to 12%.
Vale and Itaú on their heels
Following Petrobras, the Vale (ELECTION 3) received the second highest number of nominations for October, at 14.
For the Agora Investmentsthe outlook for the mining company has improved in recent weeks, following the CEO's announcement earlier than expected and the greater reliability of assets shown during the roadshow with investors.
Analysts also welcome the upward revision in production guidance for iron ore of the company for 2024, the greater confidence in reaching the production level of 340 to 360 tons in 2026 and the positive tone of management on cost performance.
“With Vale shares performing poorly over the last 12 months, the dilemma of whether or not to buy the correction has emerged as an important debate among investors and, although GGBR4 continues to be our preference in the steel and mining sector, we reiterate our positive view for VALE3”.
O Itaú (ITUB4) occupies third place in this month's ranking, with 13 recommendations.
O BTG Pactual highlights that the Brazilian retail banking business has changed drastically, particularly in the low-income segment, and Itaú has done a “great job” accepting and adapting to the changing scenario, which will allow ROE to increase sustainably.
Analysts also highlight the bank's performance in the second quarter. “We saw a very good combination of growth and (high) profitability at Brazil's premium incumbent bank in the last quarter,” they say.
Favorite stocks for the month
| Enterprise | Ticker | Recommendation |
|---|---|---|
| Petrobras | PETR3/PETR4 | 15 |
| Vale | ELECTION 3 | 14 |
| Itaú Unibanco | ITUB4 | 13 |
| Cyrela | CYRE3 | 9 |
| Bank of Brazil | BBAS3 | 8 |
| Sabesp | SBSP3 | 7 |
| Petrorio/PRIO | PRIO3 | 7 |
| JBS | JBSS3 | 7 |
| Eletrobras | ELET3/ELET6 | 7 |
| Gerdau | GGBR3/GGBR4 | 6 |
| Equatorial Energy | EQTL3 | 6 |
| Locate | RENT3 | 5 |
| Vivara | VIVA3 | 5 |
Survey
The lifting of the Money Times took into account information from stock portfolios disclosed by 22 institutions. For October, 77 actions were indicated, totaling 223 recommendations.
Participated in the survey Ágora Investimentos, Ativa Investimentos, Andbank, Daycoval, BB Investimentos, BTG Pactual, CM Capital, EQI Research, Empiricus Research, Genial Investimentos, Itaú BBA, MyCap, Nova Futura, Planner, PagBank, Rico, RB Investimentos, Safra, Santander, Terra Investments, Toro e XP Investimentos.