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Méliuz (CASH3) is close to turning the tables, evaluates BofA; second half will be a strong recovery

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Bank of America cut the share’s target price to BRL 2, but maintained a “buy” recommendation (Image: Disclosure/Méliuz)

O Méliuz (CASH3) should still report weak numbers this earnings season, but it is at an inflection point, says the Bank of America (BofA).

According to the institution, the company should turn its game around soon, with the second half promising a strong recovery, once the new products of the technology company’s ecosystem are launched and Bankly is fully integrated.

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BofA cut the target price of Méliuz’s share, from R$4.50 to R$2, but reiterated its “buy” recommendation as it sees the asset with discounted valuation, below 2 times EV/Sales (company value on sales) for 2023, even considering only the Shopping Brasil business.

BofA points out that, unlike other technology companies, Méliuz’s shares did not experience a rally (on average, techs rose 35% in the last 30 days vs. Méliuz’s 3% rise).


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The bank also updated estimates for Infracommerce (IFCM3) and getNinjas (NINJ3).

BofA raised the target price of Infracommerce paper from R$6 to R$9 and maintained the “neutral” recommendation. Analysts see positive operating trends for the company, but point out that the company’s leverage situation is the most complicated within coverage, which brings risks to operations and pressure on results.

For GetNinjas, the target price was cut by 59% to R$4.50. In the opinion of analysts, the company is not delivering a good performance in terms of operations.

The “buy” recommendation, however, was reinforced based on the valuation. BofA sees GetNinjas trading around 60% of its current net cash position, despite already showing its ability to operate above breakeven in the past.

In the technology sector, BofA still has Locaweb (LWSA3) and Totvs (TOTS3) as favorite names.

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Source: Moneytimes

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