Companhia De Saneamento Basico (ADR) (NYSE:SBS): Stock Upgraded To A “Buy” Rating


Dallas, Texas 05/19/2014 (FINANCIALSTRENDS) – Recently, the stock of Companhia de Saneamento Basico (ADR) (NYSE:SBS) was upgraded to a “buy” rating from a previously announced “hold” rating by equities research analysts at TheStreet on a research note issued on Friday, May 16, 2016. The analysts mentioned that the company’s strengths certainly outweigh its weaknesses basically its weak operating cash flow and the “buy” rating is affirmed on the premise of its promising growth in net income, attractive valuation levels, and considerable return on equity, sound financial position and expanding profit margins.

Earlier in April, investment analysts at Zacks downgraded their rating on the stock of Companhia de SaneamentoBasico (ADR) (NYSE:SBS) from an “outperform” rating to a “neutral” rating. Zacks now maintain a price target of $9.75 on the stock which is at par with its current price levels.

Recent Earnings Highlights:

The company recently released its 1Q14 earnings on Thursday, May 15, 2014 whereby it posted net operating revenue of R$ 2.8 billion for 1Q14, approximately 5.6% up from net operating revenue recorded in 1Q13. Costs and expenses increased 6.1% on a year over year basis to R$ 2 billion in 1Q14 from R$ 1.9 billion in 1Q13. EBIT during 1Q14 was reported at R$ 755.6 million, up 4% from R$ 726.3 million in 1Q13. Adjusted EBITDA during 1Q14 increased to R$ 1,015.8 million, 10.2% up from R$ 921.5 million in 1Q13. However, company reported 3.7% decline in its 1Q14 net income which was reported at R$ 477.6 million as compared to R$ 496.2 million in 1Q13.

Company Brief:

Headquartered in So Paulo, Brazil, Companhia de SaneamentoBasico (ADR) (NYSE:SBS) offers basic and environmental sanitation services and it also supplies treated water on a wholesale basis to industrial, commercial, residential and governmental customers in So Paulo.

On Friday, stock of the company closed at $10.05, gaining 5.46% from its previous close.

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