Banco Bradesco (BBDO) AI Stock Analysis

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Banco Bradesco

(NYSE:BBDO)

Rating:74Outperform

Price Target:

$3.00

▲(19.52%Upside)

Banco Bradesco's overall stock score is driven by strong technical indicators and positive earnings call sentiment, but is moderated by financial performance challenges, particularly in cash flow and leverage. Valuation remains attractive, contributing to a favorable outlook for the stock.

Banco Bradesco (BBDO) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$28.52B

Dividend Yield0.96%

Average Volume (3M)41.78K

Price to Earnings (P/E)8.0

Beta (1Y)0.37

Revenue Growth-9.78%

EPS Growth28.44%

CountryUS

Employees71,953

SectorFinancial

Sector Strength75

IndustryBanks - Regional

Share Statistics

EPS (TTM)0.09

Shares Outstanding5,330,304,700

10 Day Avg. Volume37,046

30 Day Avg. Volume41,782

Financial Highlights & Ratios

PEG Ratio1.10

Price to Book (P/B)1.00

Price to Sales (P/S)0.00

P/FCF Ratio34.07

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$3.00

Price Target Upside19.52% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering0

Banco Bradesco Business Overview & Revenue Model

Company DescriptionBanco Bradesco S.A. (BBDO) is one of the largest banking and financial services companies in Brazil. Headquartered in Osasco, São Paulo, the bank operates through a wide network of branches and service points across the country. Bradesco offers a comprehensive range of financial products and services, including retail, commercial, and investment banking, as well as asset management, insurance, and pension plans. The bank serves a diverse clientele, ranging from individual customers to small businesses and large corporations.

How the Company Makes MoneyBanco Bradesco generates revenue through several key streams. The primary source of income is interest income from loans and advances to customers, alongside income from securities and other financial instruments. Additionally, the bank earns significant revenue from fees and commissions, which are derived from services such as account management, credit card operations, and investment fund management. Bradesco's insurance division also contributes a substantial portion of its earnings, offering products like life, health, and property insurance. The bank maintains strategic partnerships and investments that enhance its service offerings and expand its market reach, further bolstering its financial performance. Economic conditions, regulatory environment, and consumer behavior are factors that influence its earnings.

Banco Bradesco Earnings Call Summary

Earnings Call Date:May 08, 2025

(Q1-2025)

% Change Since: 21.26%|

Next Earnings Date:Jul 30, 2025

Earnings Call Sentiment Positive

The earnings call reflects a generally positive performance for Bradesco, with strong growth in net income, revenue, and insurance activities. However, challenges such as the high interest rate environment and profitability issues in the retail segment present potential hurdles. The bank remains optimistic about future growth, supported by technological advancements and strategic initiatives.

Q1-2025 Updates

Positive Updates

Strong Net Income Growth

Bradesco reported a recurring net income of nearly BRL5.9 billion, reflecting a growth of more than 39% year-on-year and 8.6% quarter-on-quarter.

Robust Revenue Growth

Total revenue reached BRL32 billion, growing 15% year-on-year. Key segments such as fee and commission income increased by 10.3%, and insurance grew by 32.7% year-on-year.

Insurance Group Performance

The insurance segment showed significant traction with an ROAE of 22.4%. Insurance premiums, pension contributions, and capitalization bonds reached BRL30 billion, up 25.3% year-on-year.

Loan Portfolio Expansion

The expanded loan portfolio totaled BRL1 billion, growing 4.9% year-on-year and 2.4% quarter-on-quarter. Notable growth in micro, small, and medium-sized enterprises by almost 30% year-on-year.

Tech and Productivity Gains

Productivity in tech improved with delivery lead time reduced by 32% and business development hours increased by 53%. GenAI implementation led to a 46% efficiency gain.

Negative Updates

Challenges in Retail Segment

The mass retail segment remains a detractor of profitability, with ongoing efforts to improve cost to serve and client engagement.

Interest Rate Environment

The high interest rate environment poses challenges for NII and market activities, with potential stress on margins as rates peak.

Capital and Growth Concerns

Questions about Bradesco's capital structure and its ability to support future growth have been raised, although the bank remains confident in its current plans.

Company Guidance

In the first quarter of 2025, Banco Bradesco reported a recurring net income of BRL5.9 billion, marking a significant growth of over 39% year-on-year and 8.6% quarter-on-quarter, with a return on average equity (ROAE) of 14.4%. Total revenue reached BRL32 billion, a 15% increase from the previous year. Key financial metrics included a net interest income (NII) growth of 13.7% year-on-year and 1.4% quarter-on-quarter, and a 10.3% rise in fee and commission income. The insurance sector showed remarkable performance with a 32.7% year-on-year increase in income. The expanded loan portfolio grew by 4.9% year-on-year and 2.4% quarter-on-quarter, with significant contributions from individuals (16.2% growth) and small to medium enterprises (nearly 30% growth). The bank maintained a stable cost of risk at 3%, and NII net of provisions grew 30% year-over-year to BRL9.6 billion. Bradesco's strategy focused on secured loans, such as payroll deductible loans, which accounted for a 14.3% market share among private banks, and an impressive penetration in the agribusiness sector. The bank's operational efficiency was reflected in a 12% year-on-year growth in operating expenses, despite a reduction in headcount and a review of their service footprint. Looking ahead, Bradesco's guidance for 2025 remains optimistic, with expectations of staying within or above the projected ranges, supported by robust growth in their insurance group, investment banking, and revenue from both individual and company clients.

Banco Bradesco Financial Statement Overview

Summary

Banco Bradesco's financial performance shows strong revenue from core operations but faces profitability challenges due to declining revenue and fluctuating net income margins. The balance sheet is robust, with a strong asset base, but high leverage poses potential risks. Cash flow issues present significant concerns, with negative operating and free cash flows indicating potential liquidity risks.

Income Statement

Positive

Banco Bradesco's income statement shows a declining revenue trend with a significant drop in revenue from 2023 to 2024. The gross profit margin is strong at 100% due to the nature of banking operations. However, net profit margin has decreased, indicating challenges in maintaining profitability. EBIT margin remains robust, but the absence of EBITDA data limits further analysis.

Balance Sheet

Positive

The balance sheet reflects a strong asset base with total assets growing year over year. However, the debt-to-equity ratio is high, suggesting potential leverage risks. The equity ratio is stable, indicating a solid capital structure, though the return on equity has shown some fluctuations, pointing to variable profitability.

Cash Flow

Neutral

Cash flow statements indicate volatility with negative operating cash flows in recent years, raising concerns about cash generation capabilities. Free cash flow has been negative, highlighting potential challenges in funding operations and growth without external financing. The operating cash flow to net income ratio is negative, reflecting issues in converting earnings to cash.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	78.89B	100.27B	83.16B	92.84B	130.94B
Gross Profit	78.69B	68.16B	32.00K	11.00K	62.58B
EBITDA	23.63B	16.73B	30.28B	38.63B	11.14B
Net Income	17.25B	14.25B	21.22B	23.17B	15.84B
Balance Sheet
Total Assets	2.07T	1.93T	1.79T	1.68T	1.60T
Cash, Cash Equivalents and Short-Term Investments	476.88B	522.98B	367.61B	394.23B	497.78B
Total Debt	689.53B	631.89B	571.92B	238.94B	217.91B
Total Liabilities	1.90T	1.76T	1.63T	1.53T	1.46T
Stockholders Equity	168.41B	166.33B	159.53B	149.78B	145.62B
Cash Flow
Free Cash Flow	-93.62B	-9.32B	32.35B	-106.41B	138.17B
Operating Cash Flow	-91.33B	-177.63M	41.77B	-102.00B	142.43B
Investing Cash Flow	-5.01B	83.61B	-17.78B	-19.31B	20.46B
Financing Cash Flow	117.88B	-23.06B	21.92B	-1.61B	-36.41B

Banco Bradesco Technical Analysis

Technical Analysis Sentiment

Positive

Last Price2.51

Price Trends

50DMA

2.52

Positive

100DMA

2.26

Positive

200DMA

2.12

Positive

Market Momentum

MACD

<0.01

Positive

RSI

46.72

Neutral

STOCH

22.22

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BBDO, the sentiment is Positive. The current price of 2.51 is below the 20-day moving average (MA) of 2.62, below the 50-day MA of 2.52, and above the 200-day MA of 2.12, indicating a neutral trend. The MACD of <0.01 indicates Positive momentum. The RSI at 46.72 is Neutral, neither overbought nor oversold. The STOCH value of 22.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BBDO.

Banco Bradesco Risk Analysis

Banco Bradesco disclosed 42 risk factors in its most recent earnings report. Banco Bradesco reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Banco Bradesco Peers Comparison

Overall Rating

UnderperformOutperform

Sector (68)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BSAC	76 Outperform	$11.13B	10.42	24.02%	5.64%	18.54%	65.80%
CIB	75 Outperform	$11.71B	13.57	15.99%	15.57%	-5.45%	3.43%
BMA	74 Outperform	$4.27B	967.15	0.11%	34.13%	-46.30%	-79.35%
BBDO	74 Outperform	$28.52B	8.00	10.61%	0.96%	-9.78%	28.44%
BSBR	70 Outperform	$18.72B	15.46	10.89%	5.44%	-3.94%	31.52%
BCH	69 Neutral	$14.26B	11.00	23.88%	7.46%	-17.02%	-10.73%
Sector *	68 Neutral	$16.73B	11.75	9.79%	3.76%	11.87%	-7.97%

* Financial Sector Average

Performance Comparison

BBDO

Banco Bradesco

2.53

0.54

27.14%

BCH

Banco De Chile

28.45

5.93

26.33%

BMA

Banco Macro SA

65.50

14.04

27.28%

BSBR

Banco Santander Brasil

5.12

0.13

2.61%

BSAC

Banco Santander Chile

23.58

4.17

21.48%

CIB

Bancolombia

46.18

17.31

59.96%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 02, 2025