By Jeffrey T. Lewis
SÃO PAULO–Vibra Energia’s shares rose 6.8% after the Brazilian fuel distributor reported strong earnings for the third quarter amid improving market conditions.
Shares reached 21.88 reais, the equivalent of $4.49, and were up 32% from the end of last year through Monday’s close. Brazil’s benchmark Ibovespa stocks index was up 0.3% in early trading.
The Brazilian fuels distributor reported it swung to net income of 1.3 billion reais in the quarter from a net loss of BRL61 million a year earlier. Rising fuel prices in the quarter reduced the competitiveness of imported products, allowing Vibra to increase margins and reduce debt, the company said.
Vibra and its peers in Brazil should benefit from a better tax environment and a healthier competitive scenario going forward, which should result in better margins after three years of a challenging environment for Brazil’s fuel distribution sector, Citi Research analysts Gabriel Barra and Andrés Cardona said in a research note.
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