Via (VIIA3) surpasses Magazine Luiza (MGLU3) and has the highest increase in the Ibovespa in the week; what to do with the shares?

With an appreciation of 14.8%, the shares of Via (VIIA3) were the positive highlight of the Ibovespa in the week. Performance surpassed even rival gains Magazine Luiza (MGLU3), which rose around 11% in the period.

The earnings week arrives after the release of a new batch of results. In the fourth quarter of 2022, both Via and Magazine Luiza reported losses, with the owner of Bahia Houses It’s from Point presented accounting losses of BRL 163 million, against a profit of BRL 29 million in the last three months of 2021.

Despite the negative result, Via managed to deliver some encouraging signs, such as the improvement in physical store revenue, according to the BTG Pactual.

In the fourth quarter, the company’s consolidated gross revenue (physical and online stores) grew 9% year-on-year, driven mainly by revenue from physical stores, which advanced 18.2%. In revenue from the physical segment, there was also the allocation of R$ 350 million from the renewal of the partnership with Bradesco (BBDC4) on the cards co-branded.

In the assessment of BTG analysts, Via still needs to demonstrate a sustainable recovery in store traffic, in addition to better performance in e-commerce. The company also needs to increase monetization of online sales volume, they add.

According to the bank, these steps are essential for the company’s financial and operational leverage in the coming quarters.

BTG’s recommendation is “neutral” for the name, with a target price of BRL 4. In addition to the points already highlighted, analysts cite increased competition in the e-commerce sector and the company’s strong exposure to electronics/appliances in a challenging macroeconomic scenario.

Financing costs are higher and there is uncertainty about provisions and monetization of tax credits, complete.

For Fernando Ferrer, an analyst at Empiricus Researchthe quarterly results of the e-commerce brought little encouraging numbers. In the case of Via, the gross volume of goods (GMV) grew only 6%, while some lines were very polluted by adjustments.

“In my point of view, who surfed the quarter better was once again Free market (MELI34), which has proven to be a long-term winning business model. Group GMV grew by 35%, while total payment volume (TPV) grew by 80%. As a result, the group’s revenue increased by 56% in the period”, says the specialist.

“However, in my opinion, the stretched valuation continues to be an obstacle”, he adds.

box preservation

To the Money TimesRoberto Fulcherberguer, CEO of Via, said that the company’s priority in 2023 will be to preserve cash.

“Given all this macro scenario that is happening, the interest rate, the very expensive investment cost at the moment, we reached the decision to preserve cash. 2023 is a year of cash preservation,” he said.

The retailer announced the forecast to open from five to 10 stores in 2023, a much smaller number than the 63 stores opened last year.

According to the CEO, Via would have the potential to open 60-80 stores, but the current economic scenario calls for more caution.

“In 2022, we invested BRL 1 billion in capex (investments). 77% were between technology It is logistics. The rest went to opening new stores. Opening new stores in 2023 basically won’t happen, which reduces the company’s capex”, he said.

“If you change the scenery [macro]we are prepared, the machine is ready to make more openings”, completed the executive.