In April, investors around the world revised their expectations for the start of the interest rate cutting cycle in the United States. The movement harmed risky assets and the Ibovespa did not emerge unscathed: it fell 1.7% last month. Geopolitical uncertainties, with a possible escalation of the war in the Middle East on the radar, also disrupted the Brazilian Stock Exchange.
Given the turbulent scenario, analysts adopted caution when recommending stocks to invest in May, without major changes in portfolios. BB Investimentos explains that it carried out “only a specific movement with the aim of reducing the volatility of the portfolio, maintaining sectoral diversification”.
As a result, the list of shares most recommended by brokers in May had only two changes compared to April: the departure of Localiza (RENT3) and the inclusion of the BTG Pactual share (BPAC11). The car rental company had five recommendations last month, but only two in May.
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Vale (VALE3) remains the leader in recommendations, despite a smaller number of recommendations compared to April. After gaining yet another recommendation, Petrobras (PETR4) took second place from Itaú (ITUB4), a bank that lost two nominations.
Every month, the InfoMoney analyzes the portfolios recommended by ten brokers, highlighting the five most recommended companies. In case of a tie, the number may be higher, as happened again. Check out the eight most cited companies in May, the number of recommendations and the performance of each role in April and the year:
| Company | ticker | Number of recommendations | Return in April (%) | Return in 2024 (%) |
| OK | VALE3 | 7 | 4.04 | -13.50 |
| Petrobras | PETR4 | 5 | 15.59 | 16.40 |
| Cyrela | CYRE3 | 4 | -16.22 | -11.99 |
| Sabesp | SBSP3 | 4 | -2.89 | 8.42 |
| Itaú | ITUB4 | 4 | -9.42 | -2.38 |
| Weg | WEGE3 | 4 | 3.53 | 6.29 |
| Renner Stores | LREN3 | 4 | -9.72 | -9.40 |
| BTG Pactual | BPAC11 | 4 | -8.32 | -8.78 |
| Ibovespa | *** | *** | -1.70 | -5.26 |
Vale (VALUE3)
The mining company lost two recommendations in relation to March, but remained firmly at the top of the ranking. Órama highlights that the price of ore has been falling, but still remains above the historical average of US$75 per ton. “The expectation is to maintain this level, which ensures a still good price for Vale, ample cash generation and ability to pay profits.”
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Petrobras (PETR4)
After the company decided to distribute 50% of extraordinary profits in 2023, BB Investimentos published a target price review for the share, raising it to R$47 in December this year, with a purchase recommendation. “We understand that the prospects for production growth are good, while extraction costs remain low, a combination that should continue to produce good cash generation and dividends”, says the document.
Cyrela (CYRE3)
The construction company’s share currently costs around R$20.8. For Santander, however, the stock has room to rise to R$32 this year. The bank has a buy recommendation for the share that plummeted 18.6% in April, highlighting the launches, exposure to Minha Casa Minha Vida and the company’s robust balance sheet.
Sabesp (SBSP3)
The Sanitation Company of the State of São Paulo maintained the four recommendations from April and remains in the favorites portfolio. Guide highlights the volume and constant cash generation capacity of the company that serves a population of almost 28 million people in water supply and 25 million in sewage collection.
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Itaú (ITUB4)
For BTG Patual, the performance of Itaú’s shares in April, the worst among the big banks, “doesn’t make sense”. The bank says it expects “solid” numbers in the balance sheet for the first quarter, with an expectation of 16% growth in profit before taxes, which, if materialized, “means a favorable carryover effect also for 2025”, says the report.
Weg (WEGE3)
“Weg should be the market’s safest bet for the results of the first quarter of 2024 in the goods and capital sector, once again”, according to Ágora. The expectation of positive numbers makes the broker recommend the stock. An 8% increase in net revenue, to R$8.3 billion” is on the broker’s radar.
Renner Stores (LREN3)
“We still see Renner well positioned to gain market share in the fragmented apparel retail segment in Brazil,” says BTG. The bank cites important challenges, such as a slowdown in sales in recent quarters and an adverse macroeconomic scenario for discretionary consumption.
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BTG Pactual (BPAC11)
The bank will present the balance sheet for the first quarter of 2024 on the 13th and Banco do Brasil expects BTG’s “constancy of good results” to continue. “Every quarter, BTG reinforces our perception that the company has a solid structure, built on its various growth strategies, even in unfavorable scenarios for the capital market, which is a crucial source of revenue,” says the BTG report. BB.
