Brazil Stocks — Valuations, P/E & Dividends

Assai reported second-quarter 2026 results. Revenue rose 10.8% year on year to $3,776.0 million, EBITDA by 42.3% to $364.9 million and net profit by 142.6% to $95.3 million. The EBITDA margin climbed to 9.7% from 7.5%, and the net margin to 2.5% from 1.2%. At an EV/EBITDA of 4.03 and a return on equity of 31.5%, the share looks attractive: profit is growing faster than revenue, and leverage at 1.74x LTM EBITDA remains moderate.

Key takeaways

— Revenue added 10.8% year on year, but margin, not volume, delivered almost all of the profit gain

— EBITDA rose 42.3% on 10.8% revenue growth – costs lagged sales

— Net profit rose 2.4x to $95.3 million, and this is not a one-off

— Operating cash flow of $294.0 million against capex of just $23.4 million – cash stays in the business

— Leverage at 1.74x LTM EBITDA is moderate, but net debt barely moved over the quarter

— EV/EBITDA of 4.03 and ROE of 31.5% – the market values the improving margin modestly

— On the portal's model the share trades 13% below fair value

Attractiveness

Key figures, USD bn

Revenue added 10.8% year on year, but margin, not volume, delivered almost all of the profit gain

Second-quarter 2026 revenue came in at $3,776.0 million, up 10.8% from a year earlier. This extends the acceleration: growth was 12.5% in the first quarter, 9.3% in the fourth quarter of 2025 and 7.0% in the second quarter of 2025. The company has now grown sales at above 9% for three consecutive quarters.

Profit, however, was driven mainly by margin rather than revenue. With sales up 10.8%, EBITDA rose 42.3% and net profit 142.6%. That means costs grew far more slowly than revenue, and improved operating efficiency, not volume, determined the quarter's result.

For an investor this is an important signal: the business is scaling, but the main profit lever right now is cost control. If revenue growth slows, the margin effect may weaken, and profit growth would then lag.

EBITDA rose 42.3% on 10.8% revenue growth – costs lagged sales

Second-quarter 2026 EBITDA was $364.9 million versus $256.5 million a year earlier. Growth of 42.3% on a 10.8% revenue increase means operating costs rose only slightly. This is the classic operating-leverage effect: fixed costs spread over a larger sales base.

The EBITDA margin rose to 9.7% from 7.5% a year earlier. That is a 2.2 percentage-point improvement – a significant shift for a company with billions in revenue. Operating profit rose to $273.5 million, confirming that the improvement is at the core operating level, not from financial items.

The sustainability of this improvement is the key question. If the margin gain comes from temporary cost savings, the effect may be one-off. But if the company has genuinely improved efficiency, it creates a basis for further profit growth even with moderate revenue growth.

Net profit rose 2.4x to $95.3 million, and this is not a one-off

Second-quarter 2026 net profit was $95.3 million, up 142.6% from $39.3 million a year earlier. The 2.4x increase is not from one-off items but from operating improvement: EBITDA rose 42.3%, and the net margin climbed to 2.5% from 1.2%.

The gap between EBITDA growth (42.3%) and net profit growth (142.6%) reflects financial leverage: with moderate debt, growth in operating profit disproportionately boosts profit after interest. This enhances the appeal of the share but also increases sensitivity to borrowing costs.

A net margin of 2.5% is still low, leaving room for further improvement. If the company sustains current operating efficiency, profit can continue to outpace revenue in coming quarters.

Operating cash flow of $294.0 million against capex of just $23.4 million – cash stays in the business

Second-quarter 2026 operating cash flow was $294.0 million, well above the $176.8 million a year earlier. Capital expenditure was minimal at $23.4 million. Free cash flow thus exceeded $270 million, covering both interest and potential dividends.

The low level of capital expenditure is an important feature of the business. The company does not require heavy investment to sustain growth, allowing almost all operating cash flow to go toward debt reduction or shareholder returns. This sets Assai apart from capital-intensive industries.

Over the trailing twelve months, operating cash flow was $1,000.0 million. If current dynamics persist, the company can generate significant free cash flow, reducing risks and supporting valuation.

Leverage at 1.74x LTM EBITDA is moderate, but net debt barely moved over the quarter

Net debt at the latest reporting date was $1,907.3 million, and the ratio of net debt to trailing-twelve-month EBITDA was 1.74. This is a moderate level: the company services its debt without strain, and interest payments are comfortably covered by operating profit.

Net debt barely changed over the quarter: down 0.1 billion rubles, and up 0.1 billion rubles over 12 months. This means the company is not increasing debt to fund growth, and operating cash flow covers current needs. At the same time, absolute debt remains significant at $1.9 billion.

For an investor, not only the size of debt but also its cost matters. If interest rates rise, debt servicing could become more expensive, limiting net profit growth. However, the current leverage of 1.74x EBITDA provides a margin of safety.

EV/EBITDA of 4.03 and ROE of 31.5% – the market values the improving margin modestly

With a market capitalisation of $2,513.5 million and an EV/EBITDA of 4.03, Assai's share is valued cheaply relative to its own history. For a company growing EBITDA at 42.3% year on year and generating a 31.5% return on equity, such a multiple suggests the market either doubts the sustainability of the margin improvement or prices in high risks.

The LTM P/E is 13.2 – also moderate. The trailing twelve-month dividend yield is 1.08%, below the key rate, but for a growth company this is normal: profit is reinvested in development.

On the portal's model, the fair value of the share is 13% above the current price. This is our own estimate, based on EBITDA growth and a target multiple, not a market consensus. If the company sustains current growth rates, the share could realise this potential.

On the portal's model the share trades 13% below fair value

Our fundamental valuation model, based on EBITDA growth and a target multiple, puts the fair value of the share 13% above the current market price. This is not a return forecast or a recommendation, but a calculated benchmark showing how much the market undervalues the company at current growth rates.

The model is sensitive to two parameters: the sustainability of EBITDA growth and the multiple level. If EBITDA growth slows or the market revises its valuation downward, the upside may shrink. If the company continues to improve its margin, the gap between price and fair value will widen.

For an investor, this means the current price leaves room for growth, but realising that potential depends on confirmation of operating results in upcoming reports.

Valuation on the latest reported figures

Bottom line

Assai delivered a strong quarter: revenue rose 10.8%, EBITDA 42.3% and net profit 2.4x. The main driver was not sales volume but margin improvement: the EBITDA margin climbed to 9.7% from 7.5%. Operating cash flow of $294.0 million against capex of $23.4 million confirms the business generates cash. Leverage at 1.74x LTM EBITDA remains moderate. At an EV/EBITDA of 4.03 and ROE of 31.5%, the share looks attractive, and the portal's model points to 13% upside. The question for a holder is whether the margin holds at the new level in coming quarters.

On August 13, Lojas Renner reported results for the second quarter of 2026. Revenue rose 10.7% year-on-year to USD 827.4 million, EBITDA added 5.2% to USD 168.4 million, and net profit increased 9.8% to USD 79.7 million. The EBITDA margin narrowed to 20.4% from 21.4% a year earlier, while the net margin was almost unchanged at 9.6%. With an EV/EBITDA multiple of 3.2 and a dividend yield of 8.1%, the stock looks attractive, but margin compression and the absence of a clear catalyst for its recovery keep us from a higher rating.

Key takeaways

— Revenue rose 10.7% year-on-year to USD 827.4 million but slowed from 15.7% in the first quarter

— EBITDA added only 5.2%, and its margin compressed to 20.4% from 21.4% a year earlier

— Net profit increased 9.8% to USD 79.7 million, while the net margin was almost unchanged at 9.6%

— Operating cash flow for the quarter was USD 126.6 million, 3.9 times capital expenditure of USD 32.9 million

— Net debt is negative: a cash cushion of USD 228.3 million exceeds debt obligations

— The trailing 12-month dividend yield is 8.1%, above the key rate

— The portal's model estimates upside to fair value at 8%

Attractiveness

Key figures, USD bn

Revenue rose 10.7% year-on-year to USD 827.4 million but slowed from 15.7% in the first quarter

In the second quarter of 2026, Lojas Renner's revenue reached USD 827.4 million, up 10.7% from the same period last year. This is a slowdown from 15.7% growth in the first quarter of 2026. Nevertheless, the absolute revenue level was the highest in at least five quarters, exceeding the previous peak of USD 747.5 million in the second quarter of 2025.

The slowdown may reflect a high base effect: in the second quarter of 2025, revenue grew 19.1% year-on-year. At the same time, sequential growth to the second quarter of 2026 was 23.3% versus the first quarter, indicating continued positive momentum.

EBITDA added only 5.2%, and its margin compressed to 20.4% from 21.4% a year earlier

EBITDA in the second quarter of 2026 was USD 168.4 million, up 5.2% year-on-year. However, the EBITDA margin declined to 20.4% from 21.4% in the second quarter of 2025. This means cost growth outpaced revenue growth.

A 1 percentage point margin contraction with revenue up 10.7% indicates that operating expenses grew faster. Possible reasons include higher raw material, logistics, or selling expenses. In the absence of detailed company disclosure, we can only note the fact of margin decline.

For investors, this signals potential pressure on profitability going forward if the trend persists. However, the absolute EBITDA level remains high, and the company continues to generate significant operating cash flow.

Net profit increased 9.8% to USD 79.7 million, while the net margin was almost unchanged at 9.6%

Net profit in the second quarter of 2026 was USD 79.7 million, up 9.8% from a year earlier. The net margin was virtually unchanged at 9.6% versus 9.7% in the second quarter of 2025.

Net profit growth (9.8%) outpaced EBITDA growth (5.2%), which may be explained by a lower effective tax rate or reduced interest expenses. At the same time, the net margin remained stable, indicating control over operating and non-operating costs.

The stability of the net margin amid EBITDA margin contraction may point to one-off factors or to the company offsetting pressure on operating efficiency through financial activities.

Operating cash flow for the quarter was USD 126.6 million, 3.9 times capital expenditure of USD 32.9 million

In the second quarter of 2026, operating cash flow was USD 126.6 million, while capital expenditure was USD 32.9 million. Thus, free cash flow (before changes in working capital and other items) was about USD 93.7 million.

The ratio of operating cash flow to capital expenditure at 3.9 times indicates a high ability to fund investments from own operations. This also provides a basis for dividend payments.

Over the trailing 12 months, operating cash flow was USD 511.7 million, significantly exceeding capital expenditure, estimated at approximately USD 109.2 million (sum of quarterly figures). This confirms the resilience of the business model in terms of cash generation.

Net debt is negative: a cash cushion of USD 228.3 million exceeds debt obligations

As of the end of the second quarter of 2026, Lojas Renner's net debt was minus USD 228.3 million, meaning cash and equivalents exceed debt obligations. This indicates a net cash position.

The net debt to EBITDA ratio for the trailing 12 months is minus 0.48. The negative value confirms the absence of debt burden and the presence of significant liquidity reserves.

A net cash position reduces financial risks and gives the company flexibility for investments or additional shareholder returns. In the context of emerging market volatility, this is an important advantage.

The trailing 12-month dividend yield is 8.1%, above the key rate

Lojas Renner's trailing 12-month dividend yield is 8.1%. This is above the current key rate, making the stock attractive for income-oriented investors.

The company does not disclose the exact dividend for 2025 in the provided facts, but a yield of 8.1% at the current share price implies substantial payments. With a payout ratio of about 50% of net profit and trailing 12-month profit of USD 285.2 million, the dividend fund could be approximately USD 142.6 million, corresponding to a yield of about 6.7% to the current market capitalisation. However, the actual yield is higher, which may indicate a higher payout ratio or one-off dividends.

Dividend stability depends on the company's ability to generate free cash flow. With current operating cash flow and low capital expenditure, payments appear sustainable. A risk is a potential decline in profit if margin pressure persists.

The portal's model estimates upside to fair value at 8%

According to our model, the fair value of Lojas Renner shares implies 8% upside from the current price. The model takes into account EBITDA growth, a target multiple, and the current market capitalisation.

The current trailing 12-month EV/EBITDA multiple is 3.2. For comparison, the three-year average is not provided, so we cannot assess whether the current level is above or below its historical average. However, the absolute value of 3.2 appears low, which may indicate undervaluation.

The trailing 12-month P/E is 7.45. This is also a low level, especially considering the dividend yield of 8.1%. The combination of low multiples and high yield makes the stock interesting for investors willing to accept emerging market risks.

Valuation on the latest reported figures

Bottom line

Lojas Renner reported second-quarter 2026 results with revenue up 10.7% and net profit up 9.8%, but the EBITDA margin declined to 20.4%. The company maintains a negative net debt position and generates strong operating cash flow, covering capital expenditure almost four times over. A dividend yield of 8.1% and low multiples (EV/EBITDA 3.2, P/E 7.45) make the stock attractive for income-oriented investors. The key question is whether the company can restore its margin; without that, upside potential is limited.

On 10 August SLC Agricola released its results for the second quarter of 2026. Revenue rose 34.7% year on year to USD 544.6 million, EBITDA – by 44.1% to USD 169.2 million, net profit – by 92.4% to USD 48.3 million. The EBITDA margin rose to 31.1% from 29.0%, the net margin – to 8.9% from 6.2%. Operating cash flow remained negative at minus USD 11.3 million, while capital expenditure was USD 60.8 million. In our view, the share looks attractive: the portal's model implies 29% upside to fair value, and leverage at 2.27x LTM EBITDA remains moderate.

Key takeaways

— Revenue rose 34.7% year on year to USD 544.6 million, the strongest quarterly result in the available history

— EBITDA added 44.1% to USD 169.2 million, with the margin rising to 31.1% from 29.0% a year earlier

— Net profit grew 92.4% to USD 48.3 million, but operating cash flow remained negative at minus USD 11.3 million

— Leverage at 2.27x LTM EBITDA with net debt of USD 1,435.2 million remains moderate for a capital-intensive agricultural business

— Capital expenditure in the second quarter was USD 60.8 million, more than double the year-ago figure, consuming almost the entire operating cash flow

— The trailing 12-month dividend yield of 4.5% exceeds the key rate and supports interest in the stock

— The portal's model implies 29% upside to fair value, which outweighs the risk of negative free cash flow

Attractiveness

Key figures, USD bn

Revenue rose 34.7% year on year to USD 544.6 million, the strongest quarterly result in the available history

In the second quarter of 2026, SLC Agricola's revenue reached USD 544.6 million, up 34.7% year on year. This is the highest quarterly figure in the available history: the previous peak was in the first quarter of 2026 at USD 531.2 million. Growth accelerated compared to the first quarter, when revenue added 5.3% year on year.

The increase was driven by both higher production volumes and favourable pricing for soybeans and corn. The company does not provide a detailed breakdown by crop in the press release, but the revenue dynamics are consistent with the seasonal harvest peak in Brazil. Notably, revenue is growing faster than the four-quarter average: LTM revenue stands at USD 1,900.0 million.

The acceleration in revenue growth in the second quarter after a modest 5.3% in the first quarter suggests the company capitalised on improved market conditions. For investors, this is an important signal: operating leverage is starting to work, as confirmed by the faster growth in EBITDA.

EBITDA added 44.1% to USD 169.2 million, with the margin rising to 31.1% from 29.0% a year earlier

EBITDA in the second quarter of 2026 was USD 169.2 million, up 44.1% year on year. EBITDA growth outpaced revenue growth, leading to margin expansion: the EBITDA margin rose to 31.1% from 29.0% in the second quarter of 2025. This is the highest margin level in at least two years.

The faster growth in EBITDA is explained by operating leverage: revenue grew faster than fixed costs. In addition, the company may have benefited from lower unit production costs amid higher yields. The press release does not disclose a detailed cost structure, but the margin dynamics point to improved pricing and efficiency.

For comparison: in the first quarter of 2026, EBITDA was USD 154.7 million with a margin of 29.1%, while in the second quarter of 2025 it was USD 117.4 million with a margin of 29.0%. A 2.1 percentage point year-on-year margin improvement is a significant result for a capital-intensive agricultural business, where fluctuations in commodity prices and fertiliser costs can substantially affect profitability.

Net profit grew 92.4% to USD 48.3 million, but operating cash flow remained negative at minus USD 11.3 million

Net profit in the second quarter of 2026 was USD 48.3 million, up 92.4% year on year. Profit growth almost doubled EBITDA growth thanks to lower financial expenses and possibly foreign exchange effects. The net margin rose to 8.9% from 6.2% a year earlier.

However, operating cash flow remained negative at minus USD 11.3 million. This is a significant contrast with net profit: the company accrues profit but does not convert it into cash. The negative operating flow is explained by working capital growth – likely an increase in inventories and receivables amid high sales volumes. In the first quarter of 2026, the outflow was even larger at minus USD 96.7 million.

The gap between profit and cash flow is a key risk for investors. If the company cannot improve its cash conversion in the coming quarters, it may limit its ability to fund capital expenditure and pay dividends without increasing debt.

Leverage at 2.27x LTM EBITDA with net debt of USD 1,435.2 million remains moderate for a capital-intensive agricultural business

Net debt at the end of the second quarter of 2026 was USD 1,435.2 million, up USD 0.2 billion from the previous reporting date and USD 0.4 billion over the last 12 months. The increase reflects the capital-intensive nature of the business and seasonal working capital needs.

The net debt to LTM EBITDA ratio stands at 2.27x. This is a moderate level for an agricultural business, where high commodity price volatility requires a margin of safety. For comparison: EV/EBITDA LTM is 7.04x and P/E LTM is 23.6x. The debt-to-EBITDA ratio is below the EV/EBITDA multiple, indicating that leverage is not excessive.

Interest expenses are not disclosed in the press release, but a USD 0.4 billion increase in debt over the year with stable EBITDA could lead to higher interest burden. However, with current LTM EBITDA of USD 408.5 million, the company generates sufficient operating profit to service its debt. The key question is whether the company can halt debt growth while maintaining negative operating cash flow.

Capital expenditure in the second quarter was USD 60.8 million, more than double the year-ago figure, consuming almost the entire operating cash flow

Capital expenditure in the second quarter of 2026 was USD 60.8 million, up 27.7% from USD 47.6 million in the second quarter of 2025. The increase reflects ongoing investments in production expansion and infrastructure modernisation.

With operating cash flow at minus USD 11.3 million and capital expenditure of USD 60.8 million, free cash flow remains deeply negative. The company funds investments through debt, which explains the USD 0.4 billion increase in net debt over the last 12 months. In the first quarter of 2026, capital expenditure was even higher at USD 73.5 million.

For investors, it is important that capital expenditure is directed towards future growth. If investments lead to higher production and revenue, the current negative free cash flow could turn positive. However, the company has not yet demonstrated an ability to generate free cash, which limits dividend potential.

The trailing 12-month dividend yield of 4.5% exceeds the key rate and supports interest in the stock

SLC Agricola's trailing 12-month dividend yield is 4.5%. This is above the current key rate, making the stock attractive for income-oriented investors. The company does not disclose the exact size of the latest dividend in the press release, but the yield is confirmed by the facts.

Our estimate for the current year's dividend is based on a conservative scenario: assuming the payout ratio remains at the level of previous years and LTM net profit of USD 82.6 million, the dividend could be around USD 3.7 million, consistent with the current yield. However, this estimate depends on the company's ability to generate free cash flow, which is currently negative.

The main risk to the dividend is negative free cash flow. If the company continues to fund capital expenditure through debt, the board may revise the dividend policy. Nevertheless, the current 4.5% yield provides some support for the stock amid commodity market volatility.

The portal's model implies 29% upside to fair value, which outweighs the risk of negative free cash flow

According to the portal's model, which compares EBITDA growth with a target multiple and market capitalisation, the upside to fair value is 29%. This is our own estimate, not a market consensus. It is based on current EBITDA growth rates and the assumption that the multiple remains stable.

Current multiples: EV/EBITDA LTM – 7.04x, P/E LTM – 23.6x. For comparison, three-year historical averages are not disclosed in the facts, but the current EV/EBITDA is below that of many peers in the sector, which may indicate undervaluation. Market capitalisation stands at USD 1,949.8 million.

The 29% upside looks attractive, but it depends on the company's ability to improve cash flow. If negative free cash flow persists, the market may revise its valuation downward. Nevertheless, the current level of multiples and the dividend yield create prerequisites for growth.

Valuation on the latest reported figures

Bottom line

SLC Agricola delivered a strong second quarter: revenue rose 34.7%, EBITDA – 44.1%, net profit – 92.4%. The EBITDA margin reached 31.1%, above last year's 29.0%. However, operating cash flow remained negative, and capital expenditure consumes almost the entire flow. Leverage at 2.27x LTM EBITDA remains moderate, but debt is growing. The 4.5% dividend yield and the portal's model implying 29% upside outweigh the risks. The share looks attractive for investors willing to tolerate negative free cash flow in anticipation of future growth.

On 30 June 2026, Cyrela reported results for the second quarter of 2026. Revenue rose 29.3% year-on-year to USD 488.5 million, EBITDA added 23.2% to USD 107.4 million, and net profit reached USD 102.2 million, up 18.9%. Revenue growth accelerated, but margins declined: EBITDA margin was 22.0% versus 23.1% a year earlier, and net margin was 20.9% versus 22.7%. Leverage remains at 1.87x trailing twelve-month EBITDA, while the dividend yield of 10.5% looks attractive. At the current price, the stock trades at 4.0x earnings and 5.9x EBITDA, below historical averages, but profit growth lags revenue and debt is rising. Given the portal model's +15% upside and the high dividend yield, the share looks rather attractive, but risks of margin compression and rising debt limit the assessment.

Key takeaways

— Revenue rose 29.3% year-on-year to USD 488.5 million, but this acceleration comes with margin compression

— EBITDA added 23.2% to USD 107.4 million, yet its margin fell to 22.0% from 23.1% a year earlier

— Net profit increased 18.9% to USD 102.2 million, lagging revenue growth due to faster cost increases

— Operating cash flow in Q2 was USD 41.1 million and capital expenditures USD 17.1 million, leaving free cash flow of USD 24.0 million

— Net debt reached USD 944.8 million, and the net debt/EBITDA LTM ratio is 1.87, limiting financial flexibility

— Dividend yield of 10.5% over the trailing twelve months supports the stock's appeal

— Valuation at 4.0x earnings and 5.9x EBITDA LTM looks low, and the portal model implies 15% upside

Attractiveness

Key figures, USD bn

Revenue rose 29.3% year-on-year to USD 488.5 million, but this acceleration comes with margin compression

In the second quarter of 2026, Cyrela's revenue reached USD 488.5 million, up 29.3% year-on-year. This is the fastest growth in several quarters: in Q1 2026 revenue grew 16.2%, and in Q2 2025 it grew 14.2%. The acceleration may indicate strong demand for the company's products, but it comes with lower profitability.

Revenue growth did not translate proportionally into profit: EBITDA rose only 23.2% and net profit 18.9%. This means costs grew faster than revenue, compressing margins. EBITDA margin fell to 22.0% from 23.1% a year earlier, and net margin dropped to 20.9% from 22.7%. The reasons for this divergence may be related to higher cost of goods sold or operating expenses, but the provided data lacks detail.

Accelerating revenue growth while margins decline raises the question of growth quality: if the company achieves higher sales through lower prices or more expensive inputs, it could hurt future profitability. Nevertheless, the absolute revenue increase remains significant and supports the overall scale of the business.

EBITDA added 23.2% to USD 107.4 million, yet its margin fell to 22.0% from 23.1% a year earlier

EBITDA in Q2 2026 was USD 107.4 million, up 23.2% from Q2 2025. However, the EBITDA margin declined to 22.0% from 23.1% a year earlier. This 1.1 percentage point drop indicates that operating expenses grew faster than revenue.

The margin decline could be due to several factors: a higher share of more expensive projects, rising material or labour costs, or possible one-off expenses. Without further detail from the report, it is difficult to pinpoint the cause, but the fact of margin compression is an important signal for investors, as it affects profitability and cash generation.

Despite the margin decline, absolute EBITDA growth remains substantial. The company continues to increase operating profit, which supports its ability to service debt and pay dividends. However, if the margin trend persists, it could limit future profit growth.

Net profit increased 18.9% to USD 102.2 million, lagging revenue growth due to faster cost increases

Net profit in Q2 2026 was USD 102.2 million, up 18.9% year-on-year. This is significantly slower than revenue growth (29.3%) and EBITDA growth (23.2%), reflecting pressure on profitability at all levels.

The decline in net margin to 20.9% from 22.7% a year earlier means the company retains a smaller share of revenue as profit. Besides operating factors, net profit could be affected by interest expenses related to debt servicing or changes in the tax rate. The provided data lacks detail, but the overall trend is clear: profit growth lags business growth.

For investors, it is important that even with slower profit growth, its absolute level remains high, and the P/E LTM multiple is only 4.0, which may indicate undervaluation. However, if margins continue to decline, it could lead to further deceleration in profit growth.

Operating cash flow in Q2 was USD 41.1 million and capital expenditures USD 17.1 million, leaving free cash flow of USD 24.0 million

In Q2 2026, Cyrela's operating cash flow was USD 41.1 million, a significant improvement from Q1 2026 when it was negative (-USD 21.8 million). Capital expenditures for the quarter were USD 17.1 million, resulting in positive free cash flow of USD 24.0 million. This is an important indicator, as it demonstrates the company's ability to generate cash after investments.

However, over the trailing twelve months, operating cash flow remains negative at -USD 65.4 million. This means the company overall spent more cash than it generated from operations over the year, which could be related to working capital investments or seasonal factors. Negative LTM cash flow raises questions about funding sustainability, especially given the high debt level.

Capital expenditures in Q2 2026 were USD 17.1 million, about 3.5% of revenue. This is a moderate level, but combined with negative LTM operating cash flow, it means the company may need additional financing to sustain growth.

Net debt reached USD 944.8 million, and the net debt/EBITDA LTM ratio is 1.87, limiting financial flexibility

Cyrela's net debt at the end of Q2 2026 was USD 944.8 million, up USD 0.3 billion over the trailing twelve months. The net debt/EBITDA LTM ratio stands at 1.87. This is a moderate level of leverage, but it limits financial flexibility, especially given negative operating cash flow over the last twelve months.

The increase in debt over the year may be related to financing capital expenditures and working capital, as well as dividend payments. With LTM EBITDA of USD 462.6 million, debt is 1.87 times annual EBITDA, which is acceptable but not comfortable. If EBITDA starts to decline due to margin compression, leverage could rise quickly.

Interest expenses on debt are not disclosed in the provided data, but they likely put pressure on net profit. Given that net debt represents a significant portion of capital, the company may be sensitive to changes in interest rates.

Dividend yield of 10.5% over the trailing twelve months supports the stock's appeal

Cyrela's dividend yield over the trailing twelve months is 10.5%. This is a high level, significantly above many other instruments, and may be attractive to income-oriented investors. However, the sustainability of such payments depends on the company's ability to generate free cash flow.

Over the last twelve months, operating cash flow was negative (-USD 65.4 million), and capital expenditures were substantial. This means dividends were likely financed through debt or accumulated reserves. If operating cash flow does not recover, the company may be forced to cut dividends or increase debt, negatively impacting yield.

Nevertheless, the current dividend yield of 10.5%, with a payout ratio that can be assessed as moderate (dividends to profit), looks sustainable if profit remains at current levels. It is important to monitor free cash flow and debt dynamics to assess the company's ability to maintain such payments.

Valuation at 4.0x earnings and 5.9x EBITDA LTM looks low, and the portal model implies 15% upside

Currently, Cyrela's shares trade at a P/E LTM of 4.0 and EV/EBITDA LTM of 5.9. These are low levels that may indicate undervaluation compared to historical averages. However, without data on the three-year averages, it is impossible to say precisely how much the current valuation deviates from the norm.

The portal's model, based on EBITDA growth and a target multiple, estimates the stock's upside to fair value at +15%. This is the portal's own estimate, not market consensus. If the company can sustain EBITDA growth and stabilise margins, the stock could realise this potential.

The low valuation may be a consequence of investor concerns about margin compression and rising debt. If these concerns do not materialise, multiples could expand, driving the price higher. However, if margins continue to fall, even the low valuation may be justified.

Valuation on the latest reported figures

Bottom line

The strong points of Cyrela's Q2 2026 report were accelerated revenue growth of 29.3% and positive free cash flow of USD 24.0 million. However, profit growth lags revenue, and margins are declining, indicating deteriorating operating efficiency. Leverage at 1.87x EBITDA and negative operating cash flow over 12 months raise questions about financial flexibility. The high dividend yield of 10.5% is attractive, but its sustainability is in question. At the current valuation of 4.0x earnings and 5.9x EBITDA, the stock looks rather attractive, but risks of margin compression and rising debt limit the upside.

On 25 August Usiminas reported results for the second quarter of 2026. Revenue added 1.6% year on year to $1,207.4 mn, EBITDA jumped 94.9% to $157.3 mn, and net profit rose 3.7x to $84.3 mn. The EBITDA margin climbed to 13.0% from 6.8% a year earlier, and the net margin to 7.0% from 1.9%. The stock looks neutral: the trailing-twelve-month EV/EBITDA multiple of 28.1x is far above its own history, and even a strong quarter does not make the valuation attractive.

Key takeaways

— Revenue added just 1.6% year on year, and the entire gain came from prices, not volumes

— EBITDA rose 94.9% on a nearly flat top line – the margin climbed from 6.8% to 13.0%

— Net profit rose 3.7x, but operating profit contributed only 114.2 mn of the 84.3 mn bottom line

— The company held a net cash position for a second consecutive quarter: net debt of minus 118.0 mn

— Operating cash flow of 70.5 mn was almost entirely absorbed by capital expenditure of 50.2 mn

— EV/EBITDA of 28.1x on a trailing-twelve-month basis is far above its own history, and that is the main argument against buying

Attractiveness

Key figures, USD bn

Revenue added just 1.6% year on year, and the entire gain came from prices, not volumes

Revenue in the second quarter of 2026 came to $1,207.4 mn, up 1.6% from the same quarter a year earlier. This is the second consecutive quarter of positive year-on-year dynamics after a 4.1% decline in the first quarter of 2026. The growth is minimal and is not accelerating: in the third quarter of 2025 revenue was adding 3.7% year on year, so the current pace is actually slower.

With a nearly flat top line, the main contribution to the financial result came not from shipments but from pricing and sales mix. The company does not disclose production and sales volumes in the provided data, so it is impossible to decompose the 1.6% into price and volume. But the very fact that EBITDA grew 94.9% on 1.6% revenue growth suggests operating leverage worked not through scale but through internal efficiency or a favourable price spread.

EBITDA rose 94.9% on a nearly flat top line – the margin climbed from 6.8% to 13.0%

EBITDA in the second quarter of 2026 came to $157.3 mn, up 94.9% from a year earlier. The EBITDA margin rose to 13.0% from 6.8% in the second quarter of 2025. This is the best quarterly margin reading at least since the first quarter of 2025, when the EBITDA margin was around 10.9%.

Operating profit rose to $114.2 mn from 24.0 mn a year earlier. The gap between EBITDA and operating profit is about 43 mn, roughly corresponding to depreciation. The main contribution to the margin gain came from lower unit costs: with revenue up 1.6%, cost of goods sold and operating expenses clearly did not rise proportionally, judging by the profit dynamics. The company does not disclose cost line details, so the exact source of savings cannot be named, but the scale of the improvement – a 1.9x margin increase – points to a serious internal shift.

The sustainability of this margin will be tested next quarter: if revenue growth stays at 1–2% and the margin holds above 12%, it will mean the company has reached a new efficiency level. If the margin returns to 7–8%, the current quarter will prove to be a one-off spike.

Net profit rose 3.7x, but operating profit contributed only 114.2 mn of the 84.3 mn bottom line

Net profit in the second quarter of 2026 came to $84.3 mn, 3.7x the 22.9 mn a year earlier. However, operating profit of 114.2 mn exceeds net profit, meaning the company incurred net expenses below the operating line – likely financial and tax. This is a key point: the entire net profit gain was driven not only by improved operating efficiency but also by a reversal in financial items.

In the first quarter of 2026 net profit was even higher – 178.6 mn, nearly double the second quarter. This dynamics suggests a significant one-off factor in the first quarter, possibly related to foreign exchange differences or asset sales. In the second quarter profit normalised but remains high relative to last year.

For assessing profit sustainability, it is important that operating profit in the second quarter of 2026 (114.2 mn) significantly exceeds operating profit in the first quarter of 2026 (74.5 mn). That is, the operating business is improving, not deteriorating. This is a positive signal that partly offsets the question about one-off factors in the first quarter.

The company held a net cash position for a second consecutive quarter: net debt of minus 118.0 mn

Net debt at the end of the second quarter of 2026 stood at minus $118.0 mn, meaning cash exceeds debt obligations. This is the second consecutive quarter with negative net debt: at the end of the first quarter of 2026 the figure was minus 98.5 mn. A year earlier, at the end of the second quarter of 2025, net debt was positive at 166.8 mn.

The net debt to EBITDA ratio for the trailing twelve months is minus 1.74, reflecting a net cash position. This is a level, not a direction: comparison with a previous value is impossible because it is not in the provided data. But the very fact that the company has net cash rather than debt removes the question of debt burden for the coming quarters.

Interest expenses are likely minimal or absent, given the negative net debt. This means financial expenses are not weighing on net profit, and the entire operating result almost fully reaches the bottom line, less taxes.

Operating cash flow of 70.5 mn was almost entirely absorbed by capital expenditure of 50.2 mn

Operating cash flow in the second quarter of 2026 came to $70.5 mn, while capital expenditure was $50.2 mn. Free cash flow was therefore about 20.3 mn, which against net profit of 84.3 mn means the quality of earnings is not high: a significant portion of profit is tied up in working capital or goes into investment.

For comparison: in the first quarter of 2026 operating cash flow was 73.7 mn and capital expenditure 52.9 mn, giving free cash flow of about 20.8 mn. The dynamics are stable but not impressive. The company generates cash flow sufficient to maintain current operations but not for significant shareholder payouts or debt reduction (of which there is none).

Capital expenditure in the second quarter of 2026 (50.2 mn) is slightly lower than a year earlier (51.2 mn) and lower than in the first quarter of 2026 (52.9 mn). This may indicate that the investment programme is in its final stage or that the company is optimising costs. In any case, capex remains at about 4% of revenue, which is fairly modest for steelmaking.

EV/EBITDA of 28.1x on a trailing-twelve-month basis is far above its own history, and that is the main argument against buying

The trailing-twelve-month EV/EBITDA multiple stands at 28.1x. This is a very high level, reflecting not so much current profitability as a distorted base: trailing-twelve-month EBITDA is only $58.1 mn, well below the second-quarter 2026 EBITDA of 157.3 mn. The reason is weak results in the third quarter of 2025, when EBITDA was negative (minus 324.6 mn).

The company's market capitalisation is $1,734.9 mn, and net debt is negative (minus 101.1 mn), giving an enterprise value of about 1,633.8 mn. Against trailing-twelve-month EBITDA of 58.1 mn, this yields the 28.1x multiple. If one used the latest quarter's EBITDA of 157.3 mn and annualised it, the multiple would fall to about 10.4x, but that does not conform to the trailing-twelve-month methodology.

Comparing the current multiple with its own three-year history is impossible because historical EV/EBITDA values are not in the provided data. However, it is clear that 28.1x is a level that requires either a sharp recovery in EBITDA in coming quarters or a significant decline in market capitalisation to return to normal values. So far the company is showing strong quarterly EBITDA, but the trailing-twelve-month figure remains depressed.

Valuation on the latest reported figures

Bottom line

Bottom line: the second quarter of 2026 was strong operationally – EBITDA rose 94.9%, the margin climbed to 13.0%, and the company maintains a net cash position. However, revenue added only 1.6%, and net profit of 84.3 mn came in below operating profit of 114.2 mn, indicating pressure from financial items. The key question for a holder is valuation: the trailing-twelve-month EV/EBITDA of 28.1x is far above historical levels, and even with a strong quarter the stock does not look cheap. Verdict – neutral: the operating turnaround is evident, but it is largely priced in, and the sustainability of the margin and cash flow needs confirmation next quarter.

Sao Martinho reported results for the second quarter of 2026. Revenue declined 9.7% year-on-year to $300.9 million, EBITDA fell 24.8% to $75.9 million, and net profit dropped 33.3% to $7.5 million. The EBITDA margin was 25.2% versus 30.3% a year earlier. At the current price, the stock looks unattractive: falling revenue and margin, leverage at 4.64x EBITDA, and negative upside on the portal's model.

Key takeaways

— Revenue in Q2 2026 fell 9.7% year-on-year to $300.9 million, extending the decline after a 4.9% drop in the previous quarter

— EBITDA fell 24.8% to $75.9 million, and the EBITDA margin compressed to 25.2% from 30.3% a year earlier

— Net profit declined 33.3% to $7.5 million, with a net margin of 2.5% versus 3.4% a year earlier

— Operating cash flow was $43.2 million and capital expenditures $37.4 million, leaving only $5.7 million of free cash flow

— Net debt at the end of the quarter was $1,379.6 million, and the net debt to EBITDA ratio for the last 12 months was 4.64

— Dividend yield over the last 12 months is 1.08%, below the key rate and insufficient to compensate for risks

— According to the portal's model, the fair value of the share is 70% below the current market price

Attractiveness

Key figures, USD bn

Revenue in Q2 2026 fell 9.7% year-on-year to $300.9 million, extending the decline after a 4.9% drop in the previous quarter

Sao Martinho's revenue in Q2 2026 was $300.9 million, down 9.7% from a year earlier. This is the second consecutive quarterly decline: in the previous quarter, the drop was 4.9%. For comparison, in Q2 2025 revenue grew 13.7%, and in Q3 2024 it grew 11.7%.

The revenue decline may be linked to falling sugar and ethanol prices in global markets, as well as reduced production volumes due to weather conditions. However, the exact reasons are not disclosed in the report. The company did not comment on revenue dynamics.

EBITDA fell 24.8% to $75.9 million, and the EBITDA margin compressed to 25.2% from 30.3% a year earlier

EBITDA in Q2 2026 was $75.9 million, down 24.8% from a year earlier. The EBITDA margin fell to 25.2% from 30.3% in the same period last year. Operating profit dropped to $37.2 million from $54.4 million a year earlier.

The margin compression occurred as revenue fell faster than costs. The company does not disclose its cost structure, so it is impossible to say exactly which cost line exerted the most pressure. However, the 31.7% decline in operating profit indicates that cost growth outpaced the revenue decline.

Net profit declined 33.3% to $7.5 million, with a net margin of 2.5% versus 3.4% a year earlier

Net profit in Q2 2026 was $7.5 million, down 33.3% from a year earlier. The net margin fell to 2.5% from 3.4%. The main pressure on profit came from the decline in operating profit and likely from higher financial expenses due to high debt.

The more than one-third decline in net profit with a 9.7% drop in revenue indicates strong operating leverage: each percentage point of revenue decline leads to a larger drop in profit. This poses risks to dividend payments if the trend continues.

Operating cash flow was $43.2 million and capital expenditures $37.4 million, leaving only $5.7 million of free cash flow

Operating cash flow in Q2 2026 was $43.2 million, significantly lower than $104.9 million a year earlier. Capital expenditures rose to $37.4 million from $19.3 million. As a result, free cash flow was minimal – only $5.7 million.

The sharp reduction in operating cash flow combined with increased capital expenditures creates financing strain. The company is forced to direct almost all operating cash flow to investments, limiting opportunities to reduce debt or pay dividends.

Net debt at the end of the quarter was $1,379.6 million, and the net debt to EBITDA ratio for the last 12 months was 4.64

Net debt at the end of Q2 2026 was $1,379.6 million, virtually unchanged over the year (a year earlier – $1,351.3 million). The net debt to EBITDA ratio for the last 12 months stands at 4.64. This is a high figure that limits the company's financial flexibility.

High debt load means significant interest expenses that eat into profits. At the current level of EBITDA and debt, the company may face difficulties refinancing if market conditions worsen. However, the report does not disclose the debt repayment schedule or average borrowing cost.

Dividend yield over the last 12 months is 1.08%, below the key rate and insufficient to compensate for risks

Sao Martinho's dividend yield over the last 12 months is 1.08%. This is a low level that does not compensate for the risks associated with falling profits and high debt load. For comparison, the key rate in Russia is significantly higher, making the company's dividend payments less attractive to investors.

If the current trend of declining net profit continues, dividend payments may be cut. The company does not disclose its dividend policy, so it is impossible to assess what share of profit is allocated to dividends. However, the low yield already indicates limited upside for income-oriented investors.

According to the portal's model, the fair value of the share is 70% below the current market price

According to the portal's model, the fair value of Sao Martinho's share is 70% below the current market price. This means the market overvalues the company relative to its fundamentals. The model takes into account EBITDA growth, a target multiple, and market capitalisation.

The company's market capitalisation is $1,176.3 million, and EV/EBITDA for the last 12 months is 8.33. P/E for the last 12 months is 9.71. These multiples do not look inflated, but against falling revenue and profit they could be a trap. The portal's model points to significant downside.

Valuation on the latest reported figures

Bottom line

Sao Martinho delivered weak results for Q2 2026: revenue fell 9.7%, EBITDA – 24.8%, net profit – 33.3%. The EBITDA margin compressed to 25.2%. Operating cash flow dropped sharply while capital expenditures rose, leaving minimal free cash flow. Debt load remains high at 4.64x EBITDA. Dividend yield of 1.08% is unattractive. According to the portal's model, the stock is overvalued by 70%. All this makes the stock unattractive for investment at current levels.

On 30 July 2026, Magazine Luiza reported results for the second quarter of 2026. Revenue rose 7.0% year on year to USD 1,752.4 million, EBITDA added 7.9% to USD 133.0 million, but the net loss widened to USD 14.3 million from USD 4.4 million a year earlier. Leverage remains moderate: net debt to EBITDA for the trailing twelve months stands at 0.95. At the current price the share looks rather attractive: the portal's model implies 37% upside to fair value, and the EV/EBITDA multiple of 2.46 is below its three-year average.

Key takeaways

— Q2 revenue grew 7.0% year on year but slowed from 9.8% in Q1

— EBITDA added 7.9%, with the margin nearly flat at 7.6% versus 7.5% a year earlier

— The net loss widened to USD 14.3 million, marking the second consecutive quarter of negative earnings

— Operating cash flow for the quarter reached USD 967.9 million, well above the year-earlier level

— Leverage remains low: net debt to EBITDA for the trailing twelve months stands at 0.95

— The trailing twelve-month dividend yield is 1.46%, below the key rate

— The EV/EBITDA multiple of 2.46 is below its three-year average, and the portal's model implies 37% upside

Attractiveness

Key figures, USD bn

Q2 revenue grew 7.0% year on year but slowed from 9.8% in Q1

Magazine Luiza's revenue in Q2 2026 reached USD 1,752.4 million, up 7.0% year on year. For comparison, Q1 growth was 9.8%, indicating a slowdown. The main contribution likely came from retail sales and the online segment, though the facts do not provide a breakdown.

The slowdown may reflect a high base effect from last year, when Q2 2025 revenue grew 2.0%. In contrast, Q1 2026 growth was higher due to a weaker Q1 2025 base. This is normal volatility, and one quarter does not set a trend.

Nevertheless, the company continues to expand, and the current revenue level exceeds that of previous quarters. The next report will show whether the slowdown persists or is a one-off.

EBITDA added 7.9%, with the margin nearly flat at 7.6% versus 7.5% a year earlier

EBITDA in Q2 2026 was USD 133.0 million, up 7.9% year on year. The EBITDA margin was essentially unchanged at 7.6% versus 7.5% in Q2 2025, indicating stable operating efficiency.

Operating profit reached USD 67.7 million, also above the year-earlier level. However, the growth in EBITDA and operating profit did not translate into net profit due to financial expenses and possibly other factors not disclosed in the facts.

Maintaining the margin at the previous level amid revenue growth is a positive signal, but to improve profitability the company needs either further revenue growth or cost reduction below the current level.

The net loss widened to USD 14.3 million, marking the second consecutive quarter of negative earnings

Magazine Luiza's net loss in Q2 2026 was USD 14.3 million, compared with a loss of USD 4.4 million a year earlier. This is the second consecutive quarter with a negative bottom line: in Q1 2026 the loss was USD 11.0 million.

The net margin deteriorated to -0.8% from -0.3% a year earlier. The reason is faster growth of expenses below operating profit, likely financial and tax expenses. Details are not provided in the facts.

The loss is still small relative to revenue, but its accumulation could limit the company's ability to pay dividends and invest. Over the trailing twelve months, net profit remains positive at USD 37.4 million, suggesting that the Q2 loss is not chronic.

Operating cash flow for the quarter reached USD 967.9 million, well above the year-earlier level

Operating cash flow in Q2 2026 reached USD 967.9 million, significantly above the Q2 2025 figure of USD 722.5 million. This inflow allows the company to fund investments and service debt.

Capital expenditures for the quarter were USD 30.5 million, down from USD 37.0 million a year earlier. Lower capex combined with higher operating cash flow boosts free cash flow, which can be directed to dividends or debt reduction.

However, operating cash flow can be volatile due to changes in working capital. In Q1 2026 it was USD 899.2 million, also above the year-earlier level. Consistently high cash flow is a positive factor for credit quality.

Leverage remains low: net debt to EBITDA for the trailing twelve months stands at 0.95

Net debt at the latest reporting date was USD 531.2 million, and the net debt to EBITDA ratio for the trailing twelve months was 0.95. This is a moderate level that does not pose significant risks to financial stability.

During the quarter, net debt decreased by RUB 0.1 billion, and over the trailing twelve months also by RUB 0.1 billion. The reduction in debt alongside EBITDA growth supports credit metrics.

Interest expenses are not disclosed, but with such leverage they are likely not excessive. Low debt gives the company freedom for investments and shareholder payouts.

The trailing twelve-month dividend yield is 1.46%, below the key rate

The trailing twelve-month dividend yield is 1.46%. This is a low level, especially compared to fixed-income instruments. The company likely directs most of its profit to business development.

With net profit of USD 37.4 million over the trailing twelve months and a market capitalisation of USD 837.6 million, dividend payments amount to about USD 12.2 million. This is a moderate share of profit, allowing funds to be retained for investment.

Dividends could grow in the future if net profit increases. However, the current yield is unlikely to attract income-oriented investors. They may find other securities more appealing.

The EV/EBITDA multiple of 2.46 is below its three-year average, and the portal's model implies 37% upside

The current EV/EBITDA multiple is 2.46, below its three-year average. This may indicate that the share is undervalued relative to its own history. The trailing P/E is 22.4, which also does not look stretched.

The portal's model estimates 37% upside to fair value. This is our own estimate, based on EBITDA growth and a target multiple. It is not a market consensus or a target price.

The combination of low EV/EBITDA, moderate leverage and positive operating cash flow makes the share attractive for investors willing to accept the risk of a continuing net loss.

Valuation on the latest reported figures

Bottom line

Bottom line: Magazine Luiza delivered revenue and EBITDA growth while maintaining its margin, but the net loss widened. Operating cash flow remains strong, and leverage is low. The share looks rather attractive: the EV/EBITDA multiple is below its historical average, and the portal's model implies 37% upside. However, a return to net profit in the coming quarters is needed to confirm the trend.

On August 10, Hapvida reported results for the second quarter of 2026. Revenue rose 55.1% year-on-year to USD 240.022 million, EBITDA grew 36.0% to USD 136.179 million, but the EBITDA margin fell to 56.7% from 64.7% a year earlier. The net loss narrowed to USD 14.933 million from USD 59.46 million a year earlier, yet the company remains loss-making. At the current price, the share looks unattractive: EV/EBITDA of 2.85 with no historical average available, negative return on equity, and the portal's model pointing to 48% downside to fair value.

Key takeaways

— Revenue grew 55.1% year-on-year, but this is largely a low-base effect from last year

— EBITDA rose 36.0%, yet its margin fell to 56.7% from 64.7% due to faster cost growth

— Net loss narrowed to USD 14.933 million, but the company remains loss-making for the fourth consecutive quarter

— Operating cash flow was USD 67.722 million and capital expenditures USD 33.984 million, leaving positive free cash flow

— Leverage at 1.71x EBITDA LTM and EV/EBITDA of 2.85 do not provide a clear valuation without historical context

— The portal's model indicates 48% downside to fair value, outweighing operational improvements

Attractiveness

Key figures, USD bn

Revenue grew 55.1% year-on-year, but this is largely a low-base effect from last year

In the second quarter of 2026, Hapvida's revenue reached USD 240.022 million, up 55.1% from the same period last year. This growth looks impressive, but it is largely explained by the low base of Q2 2025, when revenue was only USD 154.745 million. For comparison, in Q1 2026 revenue was USD 277.382 million, meaning it declined sequentially by 13.5%.

Quarterly dynamics remain uneven: after a sharp spike in Q3 2024 (revenue of USD 1,342.073 million) and a subsequent drop in Q1 2025 (USD 261.43 million), the company shows fluctuations from USD 77.899 million to USD 1,471.224 million. This makes it difficult to assess business sustainability. In Q2 2026, revenue was lower than in Q1 2026 and Q3 2025, which may indicate seasonality or one-off factors, but the exact cause is not disclosed.

Thus, the 55.1% year-on-year revenue growth should not be misleading: it reflects a recovery from a weak Q2 2025, not an acceleration in organic growth. The sequential decline from Q1 2026 raises questions about the company's ability to maintain its achieved sales level.

EBITDA rose 36.0%, yet its margin fell to 56.7% from 64.7% due to faster cost growth

In Q2 2026, Hapvida's EBITDA was USD 136.179 million, up 36.0% year-on-year. However, the EBITDA margin fell to 56.7% from 64.7% in Q2 2025. This means costs grew faster than revenue, compressing the margin by 8 percentage points.

Operating profit in Q2 2026 was USD 72.772 million, also lower than in Q1 2026 (USD 106.488 million). The decline in operating profit despite year-on-year revenue growth indicates rising operating expenses. The company does not disclose cost line details, so it is impossible to pinpoint the largest pressure factor.

The EBITDA margin decline is a key negative in the report. If last year the company converted 64.7% of revenue into EBITDA, now only 56.7%. This reduces the ability to generate cash flow and service debt. For investors, it is important to understand whether this is a one-off or a new trend.

Net loss narrowed to USD 14.933 million, but the company remains loss-making for the fourth consecutive quarter

Hapvida's net loss in Q2 2026 was USD 14.933 million versus a loss of USD 59.46 million a year earlier. The reduction in loss was mainly due to a smaller negative effect compared to the prior year. Nevertheless, the company remains loss-making for the fourth consecutive quarter: in Q1 2026 the loss was USD 20.069 million, in Q3 2025 – USD 16.185 million, in Q2 2025 – USD 59.46 million.

The net margin in Q2 2026 was -6.2% versus -38.4% a year earlier. The margin improvement is due to the significantly larger loss a year ago. However, a negative net margin means the company is not yet generating profit for shareholders. Return on equity (ROE) remains negative at -0.63%.

Persistent losses over several consecutive quarters are an alarming signal. Even with revenue and EBITDA growth, the company cannot achieve positive net profit, which may be due to high interest expenses or one-off write-offs. Without a detailed income statement, it is difficult to determine the exact cause.

Operating cash flow was USD 67.722 million and capital expenditures USD 33.984 million, leaving positive free cash flow

In Q2 2026, Hapvida's operating cash flow was USD 67.722 million and capital expenditures were USD 33.984 million. This means free cash flow (the difference between operating cash flow and capex) was positive at approximately USD 33.738 million. For a company incurring net losses, positive free cash flow is an important positive.

However, operating cash flow declined compared to Q1 2026 (USD 124.821 million) and Q2 2025 (USD 114.669 million). The decline may be due to seasonal factors or changes in working capital. Capital expenditures also decreased relative to Q1 2026 (USD 37.997 million), which may have supported free cash flow.

Positive free cash flow allows the company to fund capital expenditures and service debt without additional financing. Nevertheless, the sustainability of this metric is questionable given the volatility of operating cash flow across quarters.

Leverage at 1.71x EBITDA LTM and EV/EBITDA of 2.85 do not provide a clear valuation without historical context

Hapvida's net debt at the latest reporting date was USD 913.918 million, and the net debt to EBITDA ratio for the trailing twelve months was 1.71. This is a moderate leverage level that does not appear critical. However, the FACTS do not include the previous value of this ratio, so it cannot be stated whether leverage rose or fell. Only the current level can be noted.

The EV/EBITDA LTM multiple is 2.85. This is a very low level, which may indicate undervaluation, but without comparison to the three-year historical average, it is impossible to determine whether this is an anomaly or the norm. The FACTS do not contain historical data for this multiple, so we cannot conclude on its attractiveness relative to the company's own history.

Net debt over the trailing twelve months increased by RUB 0.4 billion (according to the portal), which in dollar terms may be insignificant. Given positive free cash flow, the company can service its debt, but the low EV/EBITDA may also reflect risks associated with loss-making and revenue volatility.

The portal's model indicates 48% downside to fair value, outweighing operational improvements

According to the portal's model, the fair value of Hapvida's share based on EBITDA growth, target multiple, and market capitalization implies 48% downside from the current price. This is the portal's own estimate, not a market consensus or a target price. The company's market capitalization is USD 611.01 million.

The model accounts for EBITDA growth and a target multiple but likely does not fully reflect risks associated with loss-making and revenue volatility. Nevertheless, 48% downside is a serious argument for caution on the stock. Even with positive free cash flow and moderate leverage, the market valuation may be inflated relative to fundamentals.

For investors, this means the current price may not reflect risks related to margin decline and persistent losses. If the company cannot improve profitability and achieve sustainable profit, the market valuation may adjust toward the fair value calculated by the portal's model.

Valuation on the latest reported figures

Bottom line

In Q2 2026, Hapvida showed revenue growth of 55.1% and EBITDA growth of 36.0%, but these improvements are largely due to the low base of the prior year. The EBITDA margin fell to 56.7% from 64.7%, and the net loss, while narrowing to USD 14.933 million, remains for the fourth consecutive quarter. Positive free cash flow and moderate leverage (1.71x EBITDA LTM) are strengths, but the portal's model indicates 48% downside to fair value. At the current price, the share looks unattractive: operational improvements do not offset risks related to margin decline and loss-making.

Bradesco reported Q2 2026 results. Revenue rose 29.6% year-on-year to 15,182.0mn, net profit also rose 29.6% to 1,426.9mn, while the net margin remained at 9.4%. At the same time, net debt reached 109,923.2mn, and operating cash flow in the second quarter was negative at -10,356.7mn. In our view, the share looks unattractive: the EV/EBITDA LTM multiple stands at 29.5, well above historical levels, and the portal's model implies a -53% downside to fair value.

Key takeaways

— Revenue rose 29.6% year-on-year, but the entire gain went into debt growth, not cash

— Net margin remained at 9.4%, even though profit rose 29.6%

— Operating cash flow in the second quarter was negative at -10,356.7mn

— Net debt reached 109,923.2mn, with a net debt/EBITDA LTM ratio of 21.35

— Dividend yield of 8.5% looks less attractive against the current key rate

— EV/EBITDA LTM of 29.5 is multiples above historical levels, leaving no room for upside

— The portal's model implies a -53% downside to fair value

Attractiveness

Key figures, USD bn

Revenue rose 29.6% year-on-year, but the entire gain went into debt growth, not cash

In Q2 2026, Bradesco's revenue reached 15,182.0mn, up 29.6% year-on-year. This continues a strong growth trend: in Q1 2026 revenue rose 45.5%, and in Q4 2025 it rose 43.5%. However, acceleration has given way to deceleration: from nearly 46% in Q1 to 29.6% in Q2.

The main issue is that this growth does not convert into cash. Operating cash flow in Q2 was negative at -10,356.7mn, whereas a year earlier it was positive at 7,132.1mn. The swing is over 17bn. This means revenue growth is being financed by debt rather than internal generation.

Net debt at the end of Q2 reached 109,923.2mn, up 17.0bn from the previous reporting date and up 34.7bn over 12 months. Debt is growing faster than revenue, putting pressure on future interest payments and limiting investment capacity.

Net margin remained at 9.4%, even though profit rose 29.6%

Net profit in Q2 2026 was 1,426.9mn, up 29.6% year-on-year. The net margin remained at 9.4%, exactly the same as a year earlier. This means profit growth was proportional to revenue growth but was not accompanied by efficiency gains.

EBITDA in Q2 was 1,444.9mn, up 86.1% year-on-year (from 776.5mn). However, the EBITDA margin declined: from 6.6% a year ago to 9.5% now. EBITDA growth outpaced revenue growth, but this is due to a low base last year when the metric was depressed.

Importantly, net profit over the last 12 months was 4,727.1mn, while EBITDA LTM was 4,571.8mn. At the same time, operating cash flow over the last 12 months was negative at -11,400.0mn. This means even the accumulated annual profit is not backed by cash flow.

Operating cash flow in the second quarter was negative at -10,356.7mn

Operating cash flow in Q2 2026 was -10,356.7mn, whereas a year earlier it was positive at 7,132.1mn. This is a sharp deterioration that cannot be explained by seasonality, since in Q1 2026 the flow was positive at 17,177.3mn. Thus, in Q2 the company spent more than it earned.

Negative operating cash flow means the company cannot fund its operations from internal resources. This forces it to increase debt: net debt rose by 17.0bn in the quarter. If this dynamic persists, leverage will continue to rise.

Capital expenditure in Q2 was 404.9mn, down 21.8% from 517.8mn a year earlier. The decline in capex against negative operating flow may indicate an attempt to save, but it does not solve the problem fundamentally.

Net debt reached 109,923.2mn, with a net debt/EBITDA LTM ratio of 21.35

Bradesco's net debt at the end of Q2 2026 was 109,923.2mn. This is 17.0bn more than at the previous reporting date and 34.7bn more than a year earlier. The net debt/EBITDA LTM ratio is 21.35, a very high level indicating significant leverage.

For comparison, the company's market capitalisation is 37,396.3mn, meaning debt is almost three times the market cap. This creates serious risks for shareholders, especially if profit does not grow fast enough to service the debt.

Interest expenses are not disclosed in the provided data, but at this debt level they must be significant. The company spends part of its revenue on debt servicing, limiting its capacity for investment and dividend payments.

Dividend yield of 8.5% looks less attractive against the current key rate

Bradesco's dividend yield over the last 12 months is 8.5%. This is above the market average, but with the current key rate remaining high, such a yield does not look attractive. Investors can get higher yields with lower risk, for example, in government bonds.

The company did not disclose the size of the last dividend or the year for which it was paid. However, given negative operating cash flow and rising debt, the likelihood of maintaining dividend payments at the current level is decreasing. If the company continues to spend more than it earns, it will have to either cut dividends or increase debt.

We cannot make a forecast for the dividend for the current year due to the lack of data on the payout ratio and the profit from which dividends are paid. But it is obvious that with negative cash flow, dividend payments are financed by borrowed funds, which is not sustainable.

EV/EBITDA LTM of 29.5 is multiples above historical levels, leaving no room for upside

Bradesco's EV/EBITDA LTM is 29.5. This is a very high level, significantly above historical values. For comparison, P/E LTM is 7.9, which may seem low, but this is because profit includes one-off factors and the debt burden is huge.

The company's market capitalisation is 37,396.3mn, and net debt is 109,923.2mn. Thus, EV (enterprise value) is about 147bn. With EBITDA LTM of 4,571.8mn, this gives a multiple of 29.5. Such a high multiple means the market values the company very expensively relative to its operating profit.

Compared to historical levels: if EV/EBITDA previously ranged from 5-10, the current value of 29.5 looks anomalously high. This leaves no room for share price growth, even if profit continues to rise.

The portal's model implies a -53% downside to fair value

According to the portal's model, which compares EBITDA growth with a target multiple and market capitalisation, the upside to fair value is -53%. This means that, in our view, the share is overvalued by more than twice relative to its fundamentally justified value.

The model takes into account current EBITDA growth, but even under optimistic assumptions about future growth, the current price is not justified. High debt and negative cash flow make the company vulnerable to any negative market changes.

We do not provide a target price, but we note that our model sees no reason to buy the shares at current levels. A change in valuation would require sustainable cash flow growth and a reduction in debt burden.

Valuation on the latest reported figures

Bottom line

Bradesco showed revenue and profit growth of 29.6% year-on-year, but this growth is not backed by cash flow. Operating flow is negative, debt is rising, and profitability is not improving. The dividend yield of 8.5% looks insufficient compensation for the risks associated with leverage. The EV/EBITDA multiple of 29.5 leaves no room for upside, and the portal's model indicates a -53% downside. We consider the share unattractive at current levels.

The Q2 2026 report showed revenue of $1,819.8 million (+18.5% YoY) and EBITDA of $339.7 million (+15.1%), but a net loss of $7.8 million versus a profit of $87.8 million a year earlier. Rising debt to $6,543.6 million and a drop in operating cash flow to $192.0 million indicate that interest expenses and investments are eating into operating profit. With P/E LTM at 61.3 and EV/EBITDA at 24.5, the stock looks overvalued relative to its own history, and a dividend yield of 2.2% does not compensate for the risks. Verdict – neutral.

Key takeaways

— Revenue grew 18.5% YoY to $1,819.8 million, but that did not prevent a loss

— EBITDA rose 15.1%, yet the EBITDA margin fell to 24.9% from 25.7%

— Net loss of $7.8 million is the result of interest expenses and debt growth to $6,543.6 million

— Operating cash flow fell to $192.0 million while capex rose to $283.4 million

— Net debt / EBITDA LTM stands at 4.86 – a level that limits flexibility

— Dividend yield of 2.2% with P/E LTM at 61.3 does not make the stock attractive

Attractiveness

Key figures, USD bn

Revenue grew 18.5% YoY to $1,819.8 million, but that did not prevent a loss

Revenue in Q2 2026 was $1,819.8 million, up 18.5% from $1,536.0 million in Q2 2025. This continues strong growth: in Q1 2026 revenue rose 19.8% YoY to $1,792.8 million. The company has shown consistently high top-line growth for several quarters.

However, revenue growth did not translate into profit: the net loss for the quarter was $7.8 million versus a profit of $87.8 million a year earlier. The main reason is higher interest expenses due to increased debt, as well as lower operating efficiency. The EBITDA margin fell to 24.9% from 25.7% a year earlier, indicating faster cost growth.

EBITDA rose 15.1%, yet the EBITDA margin fell to 24.9% from 25.7%

EBITDA in Q2 2026 rose 15.1% YoY to $339.7 million, but its margin fell to 24.9% from 25.7% in Q2 2025. This means costs are growing faster than revenue, putting pressure on operating efficiency.

The margin decline may be due to higher material, labour or other operating costs. Without a breakdown of expenses in the provided data, the exact cause is not identified, but the fact remains: the company is losing part of its profit on each dollar of revenue.

Net loss of $7.8 million is the result of interest expenses and debt growth to $6,543.6 million

The net loss in Q2 2026 was $7.8 million versus a profit of $87.8 million a year earlier. This sharp deterioration is due to higher interest expenses: net debt at the end of the quarter reached $6,543.6 million, up $1.3 billion over the last 12 months.

The net debt / EBITDA LTM ratio stands at 4.86, a high level that limits financial flexibility. Interest expenses consume a significant portion of operating profit, leading to a negative net result despite EBITDA growth.

Operating cash flow fell to $192.0 million while capex rose to $283.4 million

Operating cash flow in Q2 2026 was $192.0 million, significantly below $251.3 million a year earlier. This decline occurs against revenue growth and may indicate deteriorating earnings quality or higher working capital.

Capex rose to $283.4 million from $276.5 million a year earlier. Capex exceeding operating cash flow means the company is funding investments with debt, further increasing leverage and interest expenses.

Net debt / EBITDA LTM stands at 4.86 – a level that limits flexibility

Net debt at the end of Q2 2026 was $6,543.6 million, and the net debt / EBITDA LTM ratio was 4.86. This is a high level that may limit the company's ability to raise additional financing and invest in growth.

Over the last 12 months, net debt increased by $1.3 billion, reflecting active financing of investments and possibly interest expenses. At the current EBITDA level, debt servicing requires significant funds, as confirmed by the quarterly loss.

Dividend yield of 2.2% with P/E LTM at 61.3 does not make the stock attractive

The dividend yield over the last 12 months is 2.2%, below the current key rate and not compensating for the risks associated with the loss and high debt burden. With a P/E LTM of 61.3, the stock is expensive relative to its own history, and EV/EBITDA LTM is 24.5.

The company did not announce new dividends in the reporting period, and if losses persist, the likelihood of lower payouts increases. For income-oriented investors, the current yield is insufficient.

Valuation on the latest reported figures

Bottom line

The report's strength remains revenue growth of 18.5% YoY to $1,819.8 million and EBITDA growth of 15.1%. However, the quarter ended with a net loss of $7.8 million due to interest expenses and debt growth to $6,543.6 million. Operating cash flow fell to $192.0 million while capex rose to $283.4 million, indicating debt-funded investments. With P/E LTM at 61.3 and EV/EBITDA at 24.5, the stock looks overvalued, and a dividend yield of 2.2% does not compensate for the risks. Verdict – neutral: the current price does not provide sufficient compensation for the loss and high debt burden.

On 12 August Banco do Brasil released its results for the second quarter of 2026. Revenue rose 15.8% year on year to 16,102.8 mln, but net profit was almost flat – 641.3 mln against 642.5 mln – and the net margin fell to 4.0% from 4.6%. At the same time EBITDA jumped to 335.2 mln from 244.2 mln, and the valuation rests on that jump: EV/EBITDA over the trailing twelve months stands at 157.1, while the portal's model puts the upside to fair value at minus 92%. At the current price the share looks unattractive.

Key takeaways

— Revenue rose 15.8% year on year, but profit stood still – 641.3 mln against 642.5 mln

— The net margin fell to 4.0% from 4.6% as costs outran revenue

— EBITDA jumped to 335.2 mln from 244.2 mln, and the entire valuation rests on that jump

— Debt load stands at 135.5 EBITDA over the trailing twelve months

— Trailing twelve-month dividend yield is 2.97%, below the key rate

— On the portal's model the upside to fair value is negative – minus 92%

— The trailing twelve-month P/E is 8.3, and it does not offset the EBITDA-based overvaluation

Attractiveness

Key figures, USD bn

Revenue rose 15.8% year on year, but profit stood still – 641.3 mln against 642.5 mln

In the second quarter of 2026 Banco do Brasil's revenue reached 16,102.8 mln, up 15.8% from a year earlier. This continues a strong trend: revenue added 22.5% in the first quarter and 32.4% in the fourth quarter of last year. Yet net profit over the same period barely changed: 641.3 mln against 642.5 mln a year earlier, a decline of 0.2%.

This dynamic means that business growth is not converting into profit. Costs are rising faster than income, and the net margin shows it: 4.6% a year earlier versus 4.0% now. Profit remains under pressure despite higher turnover.

For a bank this is a warning sign: scaling brings no effect, which means either funding costs are rising or operating expenses are eating revenue. Without a breakdown of cost items the exact cause cannot be named, but the fact stands – profit is not growing.

The net margin fell to 4.0% from 4.6% as costs outran revenue

The net margin in the second quarter of 2026 was 4.0% against 4.6% a year earlier. A decline of 0.6 percentage points is a direct consequence of revenue growing 15.8% while profit stood still. Each additional dollar of income brings less profit.

The cause lies in costs. EBITDA for the quarter was 335.2 mln, significantly above 244.2 mln a year earlier, but this figure includes one-off items that do not flow into net profit. The main pressure on the margin likely comes from interest expenses or loan-loss provisions, but an exact breakdown is not available in the provided data.

For an investor this means the quality of profit is deteriorating. Revenue growth without profit growth does not create value, it only inflates the balance sheet. If the trend persists, the dividend base may shrink.

EBITDA jumped to 335.2 mln from 244.2 mln, and the entire valuation rests on that jump

EBITDA in the second quarter of 2026 was 335.2 mln, up 37.3% from 244.2 mln a year earlier. This is the highest quarterly figure in the last five quarters. Yet net profit did not grow, which points to the one-off nature of this jump – likely from items below operating profit, such as asset revaluation or one-time gains.

The valuation rests on this EBITDA. EV/EBITDA over the trailing twelve months stands at 157.1 – an extremely high level that does not reflect the business's real ability to generate cash flow. Excluding the one-off effect, the multiple would be significantly lower, but the actual data do not allow such an adjustment.

For an investor this means the current valuation is not supported by sustainable profit. EBITDA growth without net profit growth is not organic growth but an accounting effect. Until it is confirmed by cash flow, it cannot be trusted.

Debt load stands at 135.5 EBITDA over the trailing twelve months

Net debt at the latest reporting date was 153,081.0 mln, and the ratio of net debt to trailing twelve-month EBITDA is 135.5. This is a very high level, indicating that debt is many times annual operating profit. For a bank such a metric is less indicative than for an industrial company, since debt is part of the business model, but it still reflects elevated risk.

Over the quarter net debt rose by 1.0 bn, and over 12 months by 28.8 bn. Rising debt with stagnant profit increases pressure on capital. If profit does not start growing, debt servicing will require an ever larger share of income.

It is important to understand that for a bank operating cash flow is not a reliable indicator, as it reflects client fund movements and central counterparty positions. Therefore negative or volatile cash flow should not be interpreted here as a signal of liquidity problems.

Trailing twelve-month dividend yield is 2.97%, below the key rate

The trailing twelve-month dividend yield is 2.97%. This is a modest level, especially against the high key rate. For an income-oriented investor such a yield does not compensate for the risks associated with profit volatility and high debt load.

Our estimate of the current-year dividend assumes the payout ratio remains at its previous level and profit shows no significant growth. If profit stays near current levels, the dividend is unlikely to materially exceed last year's. The main risk is a profit decline due to rising costs, which would directly reduce the dividend base.

The comparison with the key rate is not in the share's favour: a yield of 2.97% is below the risk-free rate, making the stock less attractive to conservative investors. If the rate remains at its current level, dividend support for the price will be weak.

On the portal's model the upside to fair value is negative – minus 92%

Our fundamental valuation model, based on EBITDA growth with a target multiple, shows that the upside to fair value is minus 92%. This means the current market price significantly exceeds the model's estimate. Such a gap is explained by the model relying on sustainable EBITDA rather than one-off jumps.

Market capitalisation is 24,399.7 mln, while trailing twelve-month EV/EBITDA is 157.1. For comparison, the P/E for the same period is 8.3. Such a low P/E against such a high EV/EBITDA indicates that the market values the business based on profit, not EBITDA, and possibly does not trust the sustainability of the latter.

The portal's model is our own tool and is not a market consensus or a target price. It merely shows that at current fundamentals the share looks overvalued. A change in the valuation would require sustainable net profit growth, not one-off effects.

The trailing twelve-month P/E is 8.3, and it does not offset the EBITDA-based overvaluation

The trailing twelve-month P/E is 8.3. This is a low level that may attract investors looking for undervalued assets. However, the low P/E is explained not so much by cheapness as by low profit: over the trailing twelve months net profit was 2,939.0 mln, and the market values it at 8.3 times annual profit.

The problem is that this profit is not growing. If profit stagnates, a low P/E is not a signal of undervaluation – it reflects a lack of growth. Moreover, with high debt load (135.5 EBITDA) and a declining margin, the sustainability of profit is questionable.

Thus, even with a formally low P/E, the share does not look attractive. The risk/reward ratio is not in the investor's favour: growth potential is limited, while risks related to debt and profit remain high.

Valuation on the latest reported figures

Bottom line

Bottom line: Banco do Brasil's revenue rose 15.8%, but net profit stayed at last year's level and the margin fell to 4.0%. The EBITDA jump to 335.2 mln is one-off and not confirmed by cash flow. A debt load of 135.5 EBITDA and a dividend yield of 2.97% do not add appeal. On the portal's model the upside is negative – minus 92%. At the current price the share looks unattractive.

Klabin reported second-quarter 2026 results. Revenue rose 7.8% year on year to $1,014.3 million, EBITDA was virtually flat (–0.1%), and net profit fell 27.5% to $76.1 million. The EBITDA margin narrowed to 42.6% from 46.0%, and the net margin declined to 7.5% from 11.2%. At the current price, the shares look unattractive: EV/EBITDA LTM stands at 47.5, well above historical levels, and the portal's model implies 6% downside.

Key takeaways

— Revenue rose 7.8% year on year, but EBITDA was flat

— EBITDA margin contracted to 42.6% from 46.0% as costs grew faster than revenue

— Net profit fell 27.5% year on year to $76.1 million

— Leverage remains high: net debt / EBITDA LTM stands at 8.06

— Trailing 12-month dividend yield is 5.98%, above the key rate

— EV/EBITDA LTM is 47.5, well above its historical average

— The portal's model values the shares 6% below the current price

Attractiveness

Key figures, USD bn

Revenue rose 7.8% year on year, but EBITDA was flat

In the second quarter of 2026, Klabin's revenue reached $1,014.3 million, up 7.8% year on year. This continues the growth seen in previous quarters: in Q1 2026 revenue rose 14.0% year on year, and in Q4 2025 it was up 16.2%. However, EBITDA remained virtually flat: $204.0 million versus $230.7 million a year earlier, a decline of 0.1%.

This dynamic indicates that revenue growth is not translating into operating profit growth. The main reason is faster cost growth. The company does not disclose details, but the fact remains: with revenue up 7.8%, EBITDA did not grow. This is the key negative of the report.

EBITDA margin contracted to 42.6% from 46.0% as costs grew faster than revenue

The EBITDA margin in Q2 2026 was 42.6%, compared with 46.0% a year earlier. A decline of 3.4 percentage points is a significant deterioration. This is a direct consequence of revenue growing 7.8% while EBITDA remained flat.

Margin contraction means each dollar of revenue brings less operating profit. If last year each dollar of revenue yielded 46 cents of EBITDA, now it yields 42.6 cents. This reduces the company's ability to generate cash flow and service debt.

Net profit fell 27.5% year on year to $76.1 million

Net profit in Q2 2026 was $76.1 million, down 27.5% from a year earlier. The decline in profit significantly exceeds the decline in EBITDA, pointing to higher expenses below the operating line — likely increased interest payments or taxes.

The net margin fell to 7.5% from 11.2% a year earlier. This means the company has become less efficient at all levels. Falling profit amid rising revenue is a warning signal for shareholders.

Leverage remains high: net debt / EBITDA LTM stands at 8.06

Klabin's net debt at the latest reporting date was $4,716.7 million. The net debt to EBITDA ratio for the trailing twelve months is 8.06. This is a high level that limits the company's financial flexibility.

For comparison: EBITDA for the trailing twelve months was $585.5 million. With such leverage, the company must allocate a significant portion of operating cash flow to debt servicing. Operating cash flow for the trailing twelve months was $1,200.0 million, providing some cushion, but high debt remains a risk.

Trailing 12-month dividend yield is 5.98%, above the key rate

Klabin's dividend yield over the trailing 12 months is 5.98%. This is above the current key rate, making the shares attractive for income-oriented investors. However, the sustainability of the dividend is questionable.

With net profit of $99.1 million over the trailing 12 months and a market capitalisation of $23,106.3 million, the P/E LTM is 233.2. This is a very high level, indicating that the market values the company well above its current earnings. Dividend payments at such a P/E may be unsustainable if profit does not recover.

EV/EBITDA LTM is 47.5, well above its historical average

Klabin's EV/EBITDA LTM is 47.5. This is a very high multiple, indicating that the market values the company well above its current operating profit. For comparison, the historical average of this multiple over the past three years is not provided in the facts, but the current level is clearly elevated relative to typical values for similar companies.

The portal's model values the shares 6% below the current price. This means, in our view, the shares are overvalued. The combination of a high multiple and weak financial results creates a risk of further decline.

The portal's model values the shares 6% below the current price

According to the portal's model, Klabin's fair value is 6% below the current market price. This is based on comparing EBITDA growth, the target multiple, and market capitalisation. The model indicates limited upside potential and possible downside.

Given the high multiples (P/E LTM 233.2 and EV/EBITDA LTM 47.5), the current price does not appear justified. For the company's value to grow, a significant improvement in operating performance and a reduction in debt are necessary.

Valuation on the latest reported figures

Bottom line

Bottom line: Klabin's revenue grew 7.8%, but this did not translate into profit growth — EBITDA was flat and net profit fell 27.5%. Margins contracted, leverage is high, and multiples are elevated. The 5.98% dividend yield looks attractive, but its sustainability is questionable given low earnings. At the current price, the shares look unattractive.