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Cosan (CSAN)
NYSE:CSAN
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Cosan (CSAN) AI Stock Analysis

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CSAN

Cosan

(NYSE:CSAN)

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Neutral 58 (OpenAI - 4o)
Rating:58Neutral
Price Target:
$5.00
▲(8.70% Upside)
Cosan's overall stock score reflects solid revenue growth and cash flow generation, but is tempered by high leverage and profitability challenges. Technical indicators suggest bearish momentum, and valuation concerns arise from a negative P/E ratio. The earnings call highlighted both growth in certain segments and ongoing challenges, contributing to a cautious outlook.
Positive Factors
Diversified Business Model
Cosan's diversified operations across multiple sectors provide resilience against market volatility, ensuring stable revenue streams and long-term growth potential.
Cash Flow Generation
Strong cash flow generation enhances Cosan's ability to invest in growth opportunities, manage debt, and improve financial stability over the long term.
Strategic Capital Restructuring
The capital restructuring initiative aims to reduce financial leverage, improving financial flexibility and corporate governance, which is crucial for long-term sustainability.
Negative Factors
High Leverage
High leverage poses a risk to financial stability, potentially limiting Cosan's ability to invest in growth and increasing vulnerability to economic downturns.
Profitability Challenges
Ongoing profitability challenges, as indicated by negative net income, may hinder Cosan's capacity to reinvest in its operations and affect long-term growth prospects.
Operational Setbacks
Operational setbacks, such as the fire impacting Moove, can disrupt business continuity and require significant resources for recovery, affecting long-term operational efficiency.

Cosan (CSAN) vs. SPDR S&P 500 ETF (SPY)

Cosan Business Overview & Revenue Model

Company DescriptionCosan S.A. (CSAN) is a diversified conglomerate based in Brazil, primarily engaged in the energy and logistics sectors. The company operates through various subsidiaries, focusing on the production and distribution of biofuels, particularly ethanol, as well as sugar, renewable energy, and natural gas distribution. Cosan also has significant operations in logistics, offering integrated solutions for the transportation and storage of goods. Additionally, the company has interests in lubricants and land management, contributing to its diversified business model.
How the Company Makes MoneyCosan makes money through several key revenue streams. The company generates significant income from its biofuels and sugar segments, where it produces and sells ethanol and sugar, capitalizing on Brazil's position as a leading producer of these commodities. Revenue is also derived from its natural gas distribution business, where Cosan supplies natural gas to residential, commercial, and industrial customers in Brazil. The logistics operations provide another source of income, offering transportation, storage, and port services that are critical for agricultural and industrial sectors in the region. Cosan's lubricants business, which involves the production and sale of automotive and industrial lubricants, further complements its revenue streams. Strategic partnerships, such as joint ventures and alliances with other major companies, enhance its market presence and contribute to its financial performance. Overall, Cosan's diversified portfolio and strong presence in the energy and logistics sectors underpin its revenue-generating capabilities.

Cosan Earnings Call Summary

Earnings Call Date:Aug 14, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 13, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with stable net debt and some business segments showing growth and improved metrics. However, the company faced significant challenges, including a negative net income and issues in specific segments like Moove and Raizen's sugarcane operations.
Q2-2025 Updates
Positive Updates
Stable Net Debt and Improved Safety Metrics
Cosan's net debt remained stable compared to the previous quarter. The company reported stability in the debt service coverage ratio and a slight decrease in the average cost of debt. Safety metrics improved overall, despite a fatality, indicating a continued focus on safety as a core value.
Rumo's Increased Market Share and EBITDA
Rumo experienced higher transported volumes and an increase in market share at the Port of Santos, due to lower tariffs, which contributed to higher EBITDA.
Compass Portfolio Growth
Compass showed growth in its portfolio with higher sales in the residential segment, which brought higher margins. Additionally, there was a significant increase in the volume traded by Edge.
Positive Performance in Raizen's Fuel Distribution
Raizen's fuel distribution segment achieved better margins and higher volumes, contributing positively to the company's results.
Negative Updates
Negative Net Income
Cosan reported a negative net income of approximately BRL 1 billion for the quarter.
Lower EBITDA Due to Nonrecurring Events
The overall EBITDA was slightly below last year’s figure, primarily due to nonrecurring events from 2024.
Moove's Volume Reduction and Fire Impact
Moove experienced a reduction in volumes sold due to a fire in February, though recovery efforts are underway. The company started accounting for the insurance impacts related to this event.
Challenges in Raizen's Sugarcane Crushing
Raizen faced negative impacts on its EBITDA due to delays in sugarcane crushing caused by weather-related issues and fires in the previous harvest.
Company Guidance
During Cosan's second quarter of 2025 earnings call, the company reported an EBITDA under management of approximately BRL 6 billion, with a negative net income of about BRL 1 billion for the quarter. The net debt remained stable compared to the first quarter of 2025, with a debt service coverage ratio supported by dividends from Rumo and Radar, totaling roughly BRL 600 million. The call addressed various segments, including Rumo, which saw increased transported volumes and market share in the Port of Santos despite lower tariffs. Compass experienced growth in the residential segment, and Moove managed its recovery from the February fire, initiating claims on related insurance. The average cost of debt slightly decreased from CDI plus 90 bps to CDI plus 88 bps, with an average duration of 6.2 years. Additionally, Cosan emphasized its ongoing efforts to manage safety across its operations, despite having faced a fatality in the quarter. The call also highlighted strategic considerations for asset divestiture and the potential involvement of a strategic partner for Raizen to address capital structure challenges.

Cosan Financial Statement Overview

Summary
Cosan's financial performance shows solid revenue growth and cash flow generation but struggles with profitability due to high leverage and net losses. The significant debt levels pose risks if not managed effectively. Improvements in net income and equity position are crucial for future stability.
Income Statement
65
Positive
Cosan's income statement shows a mixed performance. The gross profit margin for the latest year was approximately 31.2%, indicating effective cost management. However, the net profit margin was negative due to a significant net loss. Revenue growth from 2023 to 2024 was about 11.36%, showing positive growth momentum. Despite a solid EBIT margin of 21.14%, the company faces profitability challenges.
Balance Sheet
60
Neutral
The balance sheet reflects a high debt-to-equity ratio of approximately 6.69, indicating heavy reliance on debt financing, which can be risky. The equity ratio stands at 7.72%, suggesting a low proportion of assets financed by equity. Return on equity is negative due to net losses, highlighting the need for improved profitability. Despite this, the company maintains substantial cash reserves.
Cash Flow
70
Positive
Cosan's cash flow statement shows strong operating cash flow relative to net income, reflecting effective cash management. Free cash flow grew by 30.9% from the previous year, suggesting an improving cash position. While the free cash flow to net income ratio is positive due to cash generation, the net income loss tempers the overall cash flow assessment.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue43.55B43.95B39.47B39.74B24.91B13.51B
Gross Profit13.71B13.71B10.92B8.98B6.34B3.69B
EBITDA12.25B13.22B14.12B6.87B4.53B1.39B
Net Income-11.74B-9.42B1.09B2.82B6.31B859.48M
Balance Sheet
Total Assets126.04B141.27B139.87B134.48B97.84B83.71B
Cash, Cash Equivalents and Short-Term Investments16.51B20.18B18.27B15.96B21.04B17.62B
Total Debt66.78B72.97B62.18B56.52B48.93B45.25B
Total Liabilities92.93B101.87B88.88B86.32B68.97B62.89B
Stockholders Equity7.19B10.90B20.96B20.65B14.74B5.26B
Cash Flow
Free Cash Flow3.79B5.25B4.01B5.44B1.16B1.09B
Operating Cash Flow12.63B13.08B10.28B9.97B5.22B2.14B
Investing Cash Flow311.06M-4.49B-4.30B-20.61B5.01B-2.34B
Financing Cash Flow-16.49B-6.61B-4.52B8.17B1.05B-1.54B

Cosan Technical Analysis

Technical Analysis Sentiment
Negative
Last Price4.60
Price Trends
50DMA
4.60
Negative
100DMA
4.96
Negative
200DMA
5.11
Negative
Market Momentum
MACD
-0.02
Positive
RSI
42.48
Neutral
STOCH
19.67
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CSAN, the sentiment is Negative. The current price of 4.6 is below the 20-day moving average (MA) of 5.21, above the 50-day MA of 4.60, and below the 200-day MA of 5.11, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 42.48 is Neutral, neither overbought nor oversold. The STOCH value of 19.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CSAN.

Cosan Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
$4.34B8.7618.13%3.37%-6.18%-9.87%
58
Neutral
$2.20B5.14-83.87%7.38%-5.62%-486.38%
56
Neutral
$3.68B-11.04-71.24%7.55%-15.98%-160.88%
52
Neutral
$1.77B-128.96-1.67%-13.09%-103.24%
51
Neutral
$1.95B-2.35-2960.38%3.14%-29.94%-723.41%
51
Neutral
$3.47B-3.48-9.63%3.67%-18.73%-236.79%
65
Neutral
$15.17B7.614.09%5.20%3.87%-62.32%
* Energy Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CSAN
Cosan
4.57
-5.33
-53.84%
CVI
CVR Energy
36.57
12.77
53.66%
DK
Delek US Holdings
32.48
14.87
84.44%
UGP
Ultrapar Participacoes SA
3.96
0.16
4.21%
PBF
PBF Energy
29.95
0.14
0.47%
PARR
Par Pacific Holdings
34.91
16.80
92.77%

Cosan Corporate Events

Cosan Announces Strategic Share Offerings to Restructure Capital
Sep 22, 2025

On September 19, 2025, Cosan S.A. announced a strategic transaction involving two primary public offerings of shares, aimed at restructuring its capital and reducing financial leverage. The first offering will issue 1.45 billion shares, with a potential 25% increase, and is backed by anchor investors including BTG Pactual and Perfin Infra. The second offering will issue up to 550 million shares with priority rights for existing shareholders. The funds raised will be used to renegotiate and repay financial debts, enhancing financial flexibility and corporate governance. The transaction is subject to corporate approvals and conditions, with a shareholders’ agreement to be signed at the settlement of the first offering.

Cosan Seeks New Investors for Rafzen Joint Venture
Sep 4, 2025

On September 4, 2025, Cosan S.A. announced that it is actively seeking new investors for its joint venture with Shell, Rafzen, as part of its ongoing efforts to enhance its capital structure. The company has been approached by various interested parties, but no binding commitments have been made yet. Cosan assures its stakeholders that it will keep them informed of any significant developments in accordance with legal requirements.

Cosan S.A. Financial Statements Reviewed with No Significant Issues
Aug 15, 2025

Cosan S.A. announced the review of its interim financial statements for the six-month period ending June 30, 2025. The review, conducted by PricewaterhouseCoopers, concluded that the financial statements were prepared in accordance with relevant accounting standards without any significant issues. This review provides stakeholders with confidence in the company’s financial reporting and operational transparency.

Cosan S.A. Submits SEC Compliance Report for August 2025
Aug 15, 2025

On August 14, 2025, Cosan S.A., a company based in São Paulo, Brazil, submitted a report to the United States Securities and Exchange Commission (SEC) as part of its compliance with the Securities Exchange Act of 1934. The report was signed by Rodrigo Araujo Alves, the Chief Financial Officer of Cosan S.A., highlighting the company’s adherence to regulatory requirements.

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: Sep 23, 2025