shares of retailers ended November poorly, ranking among the worst performers in the Ibovespawhich also did not escape the negative pressure.
In a month marked by strong volatility due to uncertainties about the formation of the ministerial teams of the new Lula government and the potential impact of the Transition PEC on the Brazilian economy, the reference index of the Exchange ended up falling by more than 3%.
The shares of the so-called “Lula package” were among the biggest losses on the Ibovespa in the period, with Americans 🇧🇷AMER3) and Via 🇧🇷VIIA3) melting, respectively, 32.05% and 30.35%. O Magazine Luiza 🇧🇷MGLU3) ended November accumulating a drop of 23.71%.
Educational companies, which were also raised by analysts as names that could benefit from the victory of Luiz Inácio Lula da Silva in the elections, recorded losses, with Cogna 🇧🇷COGN3) melting 31.91% and Yduqs 🇧🇷YDUQ3) losing 28.7%.
As expected, e-commerce retail reported results weak in the third quarter of the year. Magazine Luiza, Via and Americanas reported losses, although the first company did better (or “less worse”), according to Eleven, Genial Investimentos and TradeMap.
Magazine Luiza delivered better operating performance between July and September. However, this performance was overshadowed by the financial result, which suffered from high debt and interest rates still at high levels, increasing expenses with interest payments.
In the case of Via, the company was unable to maintain the dilution effect of selling expenses seen in the first and second quarters of the year. In the third quarter, selling expenses reached 22.5% of net revenue.
Americanas, on the other hand, reported a slowdown in demand for electronics, which impacted the performance of the 1P segment, by -31.8%. The 3P remained stable (+0.3%), while physical retail grew by 12.4%, mainly influenced by inorganic growth, as same-store sales fell by 2.7%.
Within the education sector, Itaú BBA considers that Yduqs was one of the negative highlights of the season. The positive performance of premium courses was overshadowed by the bad cycle in the on-campus and EaD (distance learning) categories compared to the third quarter of 2021, leading to a small drop in the student base year-on-year.
“Despite the numbers in the first line of the result and Ebitda having come in slightly above estimates, these challenging trends bring concerns ahead”, says the institution.
On the other hand, Cogna delivered positive numbers for the third quarter, evaluates BBA, with a strong performance in the first line of the result.
Contributing further weight on retail stocks was Neotrust’s e-commerce performance data in the sexta-feira Negra🇧🇷 Last Friday (25), virtual retail recorded a 28% drop in its revenue compared to the same period in 2021.
MGLU3, VIIA3 or AMER3?
Fabrício Gonçalvez, analyst and CEO of Box Asset Management, assesses that Magazine Luiza shares are cheap. According to the expert, the retailer is a company with good numbers and fundamentals, but “suffers at the moment due to the Brazilian scenario”.
In a report released in the month, Eleven mentions a buy recommendation for Magazine Luiza shares, with a target price of BRL 6. For Via and Americanas, the brokerage is more cautious, with a neutral recommendation and targets at BRL 4 and BRL $23 respectively.
In the case of Warren, none of the three companies has a buy rating.
“If you have the stock in your portfolio and it’s been at a loss for a long time, we recommend zeroing it out, changing the position and investing in something else, because we don’t see a prospect of improvement”, says analyst Frederico Nobre.
Check out the biggest falls on the Ibovespa in November:
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