Incannex Healthcare stock tumbles after filing $100M offering
On Monday, Citi analyst Gabriel Barra revised the price target for Ultrapar Participacoes SA (NYSE:UGPA3:BZ) (NYSE: UGP), a Brazilian company engaged in the distribution of liquefied petroleum gas (LPG), to R$22.50, down from the previous R$24.50. Despite the reduction, the firm continues to recommend the stock as a ’Buy’. Currently trading at $2.78, significantly below its 52-week high of $6.34, InvestingPro analysis suggests the stock is undervalued, with analyst targets ranging from $3.20 to $7.26.
In anticipation of Ultrapar’s fourth-quarter 2024 earnings report, set to be released on February 26, Citi forecasts that the company will report Net Revenues of approximately R$34.2 billion, which represents a 3% decrease quarter-over-quarter but a 2% increase year-over-year. Adjusted EBITDA is projected to be around R$1.4 billion, down 8% from the previous quarter and 17% from the same period last year. Net Income is expected to fall significantly to R$347 million, a 50% drop quarter-over-quarter and a 69% plunge year-over-year, primarily due to lower performance from its Ipiranga segment. For deeper insights into Ultrapar’s financial health and performance metrics, access the comprehensive Pro Research Report available on InvestingPro.
Barra noted that despite the expected decline in some financial metrics, Ultrapar is likely to report strong operating cash flow (OCF) for the fourth quarter, bolstered by a significant release of working capital. The adjustment in the price target to R$22.50 per share reflects lowered earnings estimates and an increased risk-free rate.
The analyst also highlighted Ultrapar’s inclusion in Citi’s MVPs basket, which is supported by the company’s current low valuation multiples. At the time of the report, Ultrapar’s stock was trading at 4.4x to 4.1x EV/EBITDA and at 8.8x to 7.3x PE for the years 2024-25 estimates.
In other recent news, Ultrapar Holdings has been the focus of several significant developments. JPMorgan analyst Rodolfo Angele has upgraded the company’s stock rating from Neutral to Overweight, citing the company’s successful turnaround in the fuel distribution sector and active capital allocation strategy. Ultrapar’s fuel distribution arm initiatives and investments in logistics have been noted as particularly effective.
In partnership with Supergasbrás Energia Ltda, Ultrapar plans to construct an LPG port terminal at the Port of Pecém in Brazil. This development aims to enhance the LPG supply security in the country’s North and Northeast regions, with the facility projected to be operational by 2028.
Ultrapar’s third-quarter earnings for 2024 showed a mixed financial performance. The company reported a decline in recurring EBITDA and net income, while sales volumes in some segments increased. Notably, Ipiranga saw a 4% increase in sales volume but a 34% decrease in EBITDA, while Ultragaz experienced a 4% rise in LPG sales volume with a slight 1% decrease in EBITDA.
These recent developments highlight Ultrapar’s strategic focus and ongoing commitment to pursuing efficiencies and forming strategic partnerships to enhance its business portfolio.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.