BB-BI Upgrades Sabesp to Buy With New Price Target
Financial institution raised its projection to R$ 35 after Q3 2026 earnings showed improved profitability.
BB Investimentos has upgraded Sabesp shares from sell to buy. The bank set a new price target of R$ 35 for the end of 2027. This figure represents an increase of nearly 47% compared to the previous estimate.
The revision followed the release of the third-quarter 2026 results. The company reported a 9.1% revenue growth year-over-year. Operating costs and expenses saw a controlled rise of 2.4% during the same period.
The company's Ebitda climbed 19.1% and the operating margin exceeded the 60% mark. This performance was primarily driven by a 9.9% tariff adjustment. Revenue reached R$ 6 billion when excluding construction and financial asset effects.
Analysts project that Sabesp will maintain high margins in the coming years. The expectation is that the Ebitda margin will surpass 65% starting in 2028. The recognition of investments in the regulatory asset base is expected to support revenue expansion.
The improvement in the company's operational metrics tends to influence stock performance on the Ibovespa and may impact the risk perception regarding the sanitation sector in Brazil.
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