JBS (JBSS3), the world’s largest meat producer, released its fourth quarter results on Tuesday night of 2024 (4T24), which classified as solids by XP Investimentos. The actions, by the way, record volatility, with the action opening about 1%, falling later in the same proportion.
According to XP highlighted in reportUS beef with a margin 100-base (BPS) above the estimate was a positive surprise, which can lead to positive profit reviews.
On the negative side, JBS Brazil and Australia were weaker than expected, reflecting higher prices of cattle, and can be the negative catalyst for profit reviews. Still negatively, XP highlights the sequential duplication of Capex (investments in capital) of maintenance.
Overall, XP sees JBS results positively, which should support the recent trend in stock prices, although tariffs remain a point of concern.
The company delivered an adjusted R $ 10.7 billion 4T24, EBITDA (before interest, taxes, depreciation and amortization), exceeding BBI expectations, highlighting Seara, which showed a 27% growth in sales and an EBITDA margin of 19.8%. According to the bank, JBS ended 2024 with “golden key”.
JBS also had a strong free cash flow generation (R $ 5.4 billion) and announced an additional dividend of R $ 4.4 billion (5%yield). Although the Seara cycle has shown signs of slowdown, JBS has exceeded expectations, especially in the divisions of beef.
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For the BBI, the company is still being negotiated with a discount on its peers and maintains a favorable perspective, focusing on possible US listing. The BBI maintains its outperform rating (above-average market performance, equivalent to purchase) and target price of R $ 48.
In BBA’s opinion, JBS revealed a healthy quarter, with adjusted EBITDA of R $ 10.8 billion, surpassing its projection by 11%. Adjusted for accounting gains, EBITDA also exceeded the bank’s estimates.
BBA points out that the generation of robust cash flow throughout the year has placed net debt/EBITDA below $ 2.0 times in dollars. Consequently, the company proposed an additional distribution of dividends of R $ 4.4 billion (income of approximately 5%), which can be voted in the next General Assembly.
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BBA’s view is that the recent news flow suggests an approximation of a possible US listing, which resulted in a reclassification of approximately 0.7 time value of the firm (EV)/EBITDA last week. Nevertheless, the bank sees a considerable discount on CCP and Tyson, which probably offers significant protection to JBS assessment in the coming months, assuming that the company will be negotiated with a new evaluation comparison base.
BBA has maintained recommendation equivalent to the purchase and target price of R $ 51.
Despite some punctual adjustments in 4T24 numbers, BTG estimates that 2024 was an “exceptional year” for JBS. “The results validate a long -term strategy based on growth and diversification, which has been right – especially considering the company’s commitment to balance expansion with return to shareholder and financial discipline,” says the bank.
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The adjusted EBITDA was 6% above the BTG estimate. However, the numbers were impacted by non -recurring items that totaled R $ 1.9 billion, affecting both Ebitda and Net Income.
BTG reiterated purchase recommendation and target price of $ 48.
The JPMorgan analysis team comments that EBITDA has exceeded estimates due to the strong performance in the US, Seara and Brazil beef.
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On the other hand, according to JPMorgan, margins in Australia retreated 320 base points in sequential comparison, impacted by increasing cattle prices. Dollar leverage was 1.9 time, in line with the American bank projections.
Already the Free Cash Flow (FCF) totaled R $ 5.3 billion, a solid number, but below the expectations of JPMorgan due to the impact of working capital.
JPMorgan has maintained purchase recommendation and target price of $ 46.
