After a strong 2021 for companies mining, steel industry, Paper And Cellulose and materials, the Activate Investments argues that the balance sheets for the third quarter of this year of companies in the sector were “healthy as always”.
For the broker, the positive results allow companies to pay “decent dividends” and/or invest in “value-added growth opportunities”.
Further boosting the sector, this Tuesday (23), the futures contracts of the iron ore on China went up, reaching your daily limit of 10% in the morning, with the expectation of resumption of production by steelmakers after strict controls in recent months.
Based on this scenario, Ativa reiterated its purchase recommendation for Vale (VALE3), CSN (CSNA3) e Klabin (KLBN11), with target prices of, respectively, R$133, R$67 and R$40.
Vale
According to Ativa, Vale is going through a process of production deceleration, but with maintenance of iron ore prices at healthy levels. The broker sees a potential upside of 96% for the company’s shares.
For 2022, Ativa claims that the company sees the iron ore market as “very balanced”. Vale’s production capacity is expected to reach 343 million tons in 2021 and 370 million tons in 2022, although available capacity does not necessarily translate into production.
The brokerage also points out that a demerger of base metals seems unlikely at the moment, “since Vale believes that there is substantial value to be realized before such a strategic move takes place”.
CSN
Ativa claims that CSN’s deleveraging and maintaining high liquidity are still the company’s focus, but emphasizes that there are growth options ahead.
For the broker, dividends at CSN’s parent level will likely remain at the 25% minimum level for the foreseeable future.
In the steel industry, Ativa sees price stability in the fourth quarter and a potential gradual reduction in 2022, but only if international values continue with a downward trend. In cement, the company is optimistic about synergies, after the recent acquisitions of Elizabeth e Lafarge.
This Tuesday (23), with Usiminas, CSN led the Ibovespa’s biggest hikes, driven by the jump in futures contracts for ore in China. Ativa predicts an upside of 207% for CSN’s shares.
Klabin
According to Ativa, the prospects for Klabin remain solid across all product lines, as the company is exposed to resilient markets, while benefiting from its operational flexibility.
The brokerage highlights the market slowdown in which the company operates in Brazil, but believes that “it is still at a high level with healthy order backlogs”.
Or global market of kraftliner remains “tight” with prices still rising. Domestic prices should return to have a premium in relation to international prices in the fourth or first quarter, as the price increases are implemented, defends Ativa.
For the brokerage, the upside potential for Klabin’s shares is 73%.
Source From: Moneytimes
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