Zacks Investment Research Upgrades Companhia de Saneamento Basico (SBS) to Hold

Zacks Investment Research upgraded shares of Companhia de Saneamento Basico (NYSE:SBS) from a strong sell rating to a hold rating in a research report report published on Tuesday.

According to Zacks, “In the past three months, SABESP's American Depository Receipts (ADR) have outperformed its industry. SABESP is gaining from increasing water and sewage customer base will ensure steady earnings for the company. The ongoing capital project will further strengthen SABESP's existing infrastructure, enabling it to provide quality services to Brazil’s growing population. However, SABESP is exposed to risks arising from unwarranted political or governmental interference. If consumers continue with lower consumption habits, it will hurt the performance of the company. The devaluation of the Brazilian currency compared with foreign currencies may adversely impact its share prices and ADRs. Lack of formal contracts with some municipalities served by the company is a concern.”

NYSE:SBS opened at $7.39 on Tuesday. The company has a current ratio of 1.22, a quick ratio of 1.21 and a debt-to-equity ratio of 0.62. The stock has a market capitalization of $4.03 billion, a price-to-earnings ratio of 6.37 and a beta of 1.58. Companhia de Saneamento Basico has a 1-year low of $5.58 and a 1-year high of $11.96.

Companhia de Saneamento Basico (NYSE:SBS) last posted its earnings results on Thursday, August 9th. The utilities provider reported $0.08 earnings per share for the quarter, missing the consensus estimate of $0.25 by ($0.17). The firm had revenue of $1.02 billion during the quarter, compared to analyst estimates of $1.09 billion. Companhia de Saneamento Basico had a net margin of 15.55% and a return on equity of 13.02%. Equities analysts expect that Companhia de Saneamento Basico will post 0.82 EPS for the current fiscal year.

A number of large investors have recently bought and sold shares of SBS. Campbell & CO Investment Adviser LLC acquired a new position in Companhia de Saneamento Basico in the 2nd quarter valued at about $611,000. Bank of Montreal Can boosted its holdings in Companhia de Saneamento Basico by 33.1% in the 2nd quarter. Bank of Montreal Can now owns 186,210 shares of the utilities provider’s stock valued at $1,119,000 after purchasing an additional 46,354 shares during the last quarter. Thomas White International Ltd. boosted its holdings in Companhia de Saneamento Basico by 7.2% in the 2nd quarter. Thomas White International Ltd. now owns 148,601 shares of the utilities provider’s stock valued at $893,000 after purchasing an additional 9,970 shares during the last quarter. First Manhattan Co. acquired a new position in Companhia de Saneamento Basico in the 2nd quarter valued at about $1,605,000. Finally, First Trust Advisors LP boosted its holdings in Companhia de Saneamento Basico by 2.5% in the 2nd quarter. First Trust Advisors LP now owns 536,810 shares of the utilities provider’s stock valued at $3,226,000 after purchasing an additional 13,203 shares during the last quarter. Institutional investors own 13.78% of the company’s stock.

About Companhia de Saneamento Basico

Companhia de Saneamento Básico do Estado de São Paulo-SABESP provides basic and environmental sanitation services, and supplies treated water and sewage services on a wholesale basis to residential, commercial, industrial, and governmental customers in the state of São Paulo. It provides water supply, sanitary sewage, urban rainwater management and drainage, urban cleaning, and solid waste management services, as well as related activities, including the planning, operation, maintenance, and commercialization of energy.

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