Japan PM Ishiba to announce resignation by August end – Mainichi
Goldman Sachs upgraded Suzano Papel & Celulose (NYSE:SUZ) from neutral to buy and raised its price target to R$65.00 from R$63.00, citing attractive valuation and market conditions. The new target represents a 22.6% upside potential for the Brazilian pulp and paper producer.
The investment bank noted that pulp prices are approaching marginal cost levels while the Brazilian real has depreciated by 11% year-to-date against the U.S. dollar, creating favorable conditions for the export-oriented company. Goldman Sachs also highlighted the light sector positioning, with Suzano shares down 15% year-to-date and underperforming Brazil’s Bovespa index by 29%.
Valuation metrics were key to the upgrade decision, with the firm pointing out that Suzano is trading at a 15-17% free cash flow yield and 5.4x-4.6x enterprise value to EBITDA ratio for 2026-2027. These figures compare favorably to the company’s 10-year averages of 10% free cash flow yield and 6.5x EV/EBITDA.
Goldman Sachs had maintained a more conservative stance on Suzano since initiating coverage in September 2021, during which time the stock delivered a total return of 2% compared to 19% for the Bovespa index. The firm had previously anticipated a prolonged challenging pulp price cycle.
The upgrade comes despite concerns about increasing competition from Chinese domestic supply, suggesting Goldman Sachs believes these factors are now outweighed by Suzano’s attractive valuation and improving market conditions.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.