Bank of America (BofA) lowered its EBITDA estimate for JBS by 3%, to US$ 6.1 billion, due to narrower margins at its U.S. subsidiary Pilgrim’s Pride (PPC) and foreign exchange adjustments. The target price for JBS shares was cut from US$ 21 to US$ 20, though the bank maintained its “buy” rating, highlighting a potential upside of 56%.
BofA also reduced its 2026 EBITDA projection for Pilgrim’s Pride by 13.4%, citing falling chicken prices in the U.S. However, it reaffirmed JBS as its “top pick” in the Latin American food sector, trading at a 5.8x EV/EBITDA multiple, compared with 7.7x for Tyson Foods, and offering a 7.6% dividend yield.
Despite a 19% drop in JBS shares over the past month, the bank’s analysts described the correction as “overdone.” The challenging outlook for the U.S. beef business and the normalization of margins at PPC and Seara are expected to be offset by resilient margins in Brazil, Australia, and the U.S. pork segment, along with growth in higher value-added products.
Source: Money Times
