Price of Banco do Brasil (BBAS3) involves a lot of “disadvantage”, says director of SPX

Questions surrounding the Government’s more interventionist policy on state-owned companies have triggered a repricing movement for several shares of this type of company in recent months, including those of Banco do Brasil (BBAS3).

The price adjustments, which took the stock to around R$57 in this Wednesday’s session (3), however, can also be seen as an opportunity. “I think the valuation [preço] from BB involves a lot of ‘discourage’. You can’t not have it”, observed Leonardo Linhares, director at SPX Investimentos, today, at an event promoted by Bradesco BBI.

Currently, the house has a small exposure to Banco do Brasil and Petrobras (PETR3) and (PETR4). Regarding the oil company, Linhares recognizes that there was a lot of recent noise regarding the company’s withholding of payment of extraordinary dividends, which was even questioned by President Luiz Inácio Lula da Silva (PT), but he believes that the company will remain a good payer.

“It will generate a lot of cash and this will not hinder the plan to grow and make investments […] It will make it pay a lot of dividends in the next two years. I’m relatively excited. There must be an extraordinary intermediate dividend”, added the executive.

Someone who also has a slightly more positive outlook for companies is Navi Capital. Felipe Campos, partner of the management company, who also participated in the same event, stated that Petrobras has shown generation of value and returns, whether through dividends or debt reduction.

“The noise will continue, but the perception has changed”, summarized Campos. “If Gleisi [Hoffmann] is worried about the share price, that gives me comfort”, he added, citing a recent statement made by the president of the PT. At the beginning of March, the federal deputy commented, through her social networks, on the recent significant appreciation of the oil company’s shares and that shareholders would have made a lot of money from this.

There are those who also argue that the actions of state-owned companies could be the first to react to a possible return of foreign capital, as soon as the noise surrounding the shares decreases. “I think you have to buy into them. BB and Petro trade at 4 times [preço sobre] profit”, summarizes Carlos Eduardo Rocha, CEO of Occam, at the same event this Wednesday.

Flow to Brazil

But it will not be easy to compete for the attention of foreigners, who have remained more distant from Brazilian actions. Linhares, from SPX, remembers that the United States is “sucking up” the flow of capital that would come to Brazil.

One of the important points is the low presence of companies linked to technology on the local stock exchange. The sector has been one of the highlights of the American stock markets in recent months. Another obstacle may be the normalization of American monetary policy.

“We are in a smaller interest rate cycle abroad, with effects on Brazil’s internal monetary policy. The growth channel abroad is not benefiting us”, highlighted the SPX executive.

Campos, from Navi, also notes that exposure to Brazilian assets within global portfolios has become increasingly smaller and that it has been difficult to find the “narrative” that will attract new capital this year.