Goldman Sachs lowered its price target and profit estimates for Mater Dei after including the sale of Hospital Porto Dias in the model and the second quarter results, which came in below expectations.
The bank set a target price of R$ 8.10 per share, compared to the previous R$ 9.50, and maintained a ‘buy’ recommendation.
The stock is currently trading at R$ 4.53, representing a potential upside of 78% to Goldman’s target. The stock is down 0.44% at the beginning of trading.
“The downward revision in our estimates for 2025 and 2026 is mainly due to the exclusion of operational assets from Porto Dias (345 beds) and a higher EBITDA margin in the mix,” wrote analyst Gustavo Miele.
“We are also incorporating the second-quarter numbers into our estimates, which, coupled with lower-than-expected performance and higher interest rates, has also led to a partial revision of our estimates.”
Goldman reduced its revenue estimate for 2025 by 17.2% to R$ 2.2 billion, EBITDA by 27.6% to R$ 474 million, and net profit by 42.2%.
For 2026, the cuts were 18%, 29.2%, and 35.4%, respectively.
Mater Dei announced the sale of Hospital Porto Dias in May, and the transaction was completed this month.
The company had acquired the asset in 2021, paying R$ 800 million in cash and 27.2 million Mater Dei shares, valued at R$ 22/share at the time. In the sale, Mater Dei received R$ 400 million in cash, R$ 10 million in dividends, and the 27.2 million shares back.
The company also stated that it had already received R$ 180 million in dividends and with the use of tax credits, resulting in a total loss of R$ 210 million from the sale.
“As we have mentioned before, we see strategic merits in divestments, as it reduces the risk of the company’s receivables profile and can improve cash conversion,” Miele wrote. “The receivables profile of Porto Dias seems to have materially deteriorated since the acquisition, indicating low cash generation with the asset having significant exposure to some self-payment players, which do not have expectations of improvement.”
Goldman believes that the sale will also help in new lower-risk investments, such as the hospital that Mater Dei is building in São Paulo in a joint venture with Atlântica, from Bradesco Seguros.
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.
