Porto is starting the week with two buy recommendations.
Goldman Sachs initiated coverage of the insurer with a price target of R$ 43 — a 19% upside from Friday — and Bradesco BBI upgraded from ‘neutral’ to ‘buy’, raising the price target from R$ 37 to R$ 45, a 23% increase from Friday.
The stock opened 2% higher in a bearish market.
Bradesco used three arguments to justify the recommendation: the increase in the Selic rate should boost financial results; Porto Saúde is growing more than expected; and the automobile vertical (in which Porto is a leader) is expected to perform resiliently next year, with adjustments in used car prices.
This scenario led analysts Gustavo Schroden, Eric Ito, and Gabriel Menezes to raise the profit expectations for Porto by 14% for next year and 17.7% for 2026.
“We estimate that the company can provide a total return of 30%, assuming a 12.1% CAGR in profits between 2024 and 2026 and a dividend yield of approximately 7.5%,” they wrote.
Goldman analysts also affirmed that the resilience of consumption, combined with the Selic rate hike, can improve both financial and operational results.
The American bank views Porto’s diversification and the prospects for the healthcare, services, and banking segments optimistically — all with ROEs above 20%.
“The new healthcare verticals already create value with ROEs above 20%, while the insurance business shows profitability close to 25%,” wrote analysts Tiago Binsfeld, Tito Labarta, Beatriz Abreu, and Lindsey Shema.
According to the bank’s calculations, Porto trades at 7.8x the estimated earnings for 2025, a 13% discount compared to local peers.
The bank also forecasts a 13% CAGR in earnings per share between 2024 and 2027 — also 13% above Bloomberg’s consensus. Porto’s stock has risen 40% in the last 12 months and is at its historical high. The company is valued at R$ 23.5 billion on the stock exchange.
In addition to Porto, Goldman also began coverage of IRB and Caixa Seguridade, both with ‘neutral’ recommendations and potential upsides of 10% and 8%, respectively.
Furthermore, analyst Tiago Binsfeld at Goldman now leads coverage of BB Seguridade and gave a ‘buy’ rating to the stock, with a potential upside of 24%.
Source
Arwen Volkov, A graduate of the University of St. Gallen in Switzerland with a degree in International Finance, Arwen specializes in sustainable finance and green investments. She began her career at an investment bank in London, where she developed financing models for environmentally friendly projects. Known for her analytical and strategic thinking skills, Arwen is a sought-after financial consultant. In her spare time, she mentors fintech startups, contributing to their growth strategies. She is also a nature enthusiast and an amateur photographer.
