Brazil stock exchange operator B3 falls on BTG Pactual downgrade

Vinci Compass Investments

13/11/2023 14:06

** Shares in Brazilian stock exchange operator B3  B3SA3.SA 
slip as analysts at BTG Pactual downgrade their recommendation
on the firm to "Neutral" from "Buy"
    ** The analysts led by Eduardo Rosman say the downgrade
comes on the heels of a recent rally, with the stock up 5% last
Friday and 15% month-to-date
    ** "Our bias on the stock was already less constructive, and
after plugging the Q3 figures into our model we are again
cutting our EPS estimates for the Brazilian exchange to the tune
of 1.0% and 1.5% in 2024/25," they say
    ** Even though B3's strong moats remain, with positive
margins and cash flow figures, volumes are weak and expenses are
trending up, BTG Pactual says
    ** "We still consider it a good option to play a potential
recovery in Brazil's capital markets, however we now see
stronger upside potential in names like XP  XP.O  and small caps
BR Partners  BRBI11.SA , Vinci  VINP.O , and PAX  PAX.O " 
    ** Shares in B3 slip more than 4% in morning trading, making
it the biggest faller on Brazil's Bovespa stock index  .BVSP ,
which is down 0.3%

 (Reporting by Gabriel Araujo; Editing by Steven Grattan)
 ((Gabriel.Araujo2@thomsonreuters.com; +55 11 5047-3352;))