Centrais Eletricas Brasileiras SA - Eletrobras (EBR) AI Stock Analysis

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Centrais Eletricas Brasileiras SA - Eletrobras

(NYSE:EBR)

Rating:78Outperform

Price Target:

$8.50

▲(14.86%Upside)

Centrais Eletricas Brasileiras SA exhibits a robust financial profile with strong revenue growth and profitability. Technical indicators and valuation metrics support a stable market position and reasonable valuation. Earnings call insights, while showing cost achievements, also highlighted financial setbacks, slightly affecting overall sentiment.

Centrais Eletricas Brasileiras SA - Eletrobras (EBR) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$17.22B

Dividend Yield7.51%

Average Volume (3M)1.16M

Price to Earnings (P/E)9.5

Beta (1Y)0.47

Revenue Growth0.18%

EPS Growth99.46%

CountryUS

Employees7,710

SectorUtilities

Sector Strength75

IndustryRegulated Electric

Share Statistics

EPS (TTM)0.03

Shares Outstanding2,021,139,400

10 Day Avg. Volume1,311,727

30 Day Avg. Volume1,156,841

Financial Highlights & Ratios

PEG Ratio-0.50

Price to Book (P/B)0.75

Price to Sales (P/S)0.00

P/FCF Ratio-3.38

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$10.80

Price Target Upside45.95% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

Centrais Eletricas Brasileiras SA - Eletrobras Business Overview & Revenue Model

Company DescriptionCentrais Eletricas Brasileiras SA - Eletrobras (EBR) is one of the largest electric utility companies in Latin America, primarily engaged in the generation, transmission, and distribution of electricity. Headquartered in Brazil, the company operates a diverse portfolio of hydroelectric, thermoelectric, wind, and solar power plants. Eletrobras plays a crucial role in the Brazilian power sector, providing a significant portion of the country's electricity supply and contributing to energy infrastructure development.

How the Company Makes MoneyEletrobras generates revenue through various streams, primarily by selling electricity produced from its power generation facilities. The company operates a mix of hydroelectric, thermoelectric, wind, and solar plants, which supply power to the national grid. Revenue is earned from long-term power purchase agreements (PPAs) and spot market sales. Additionally, Eletrobras earns income from its transmission business, which involves the construction, operation, and maintenance of transmission lines and substations, facilitating the distribution of electricity across Brazil. The company also benefits from partnerships and joint ventures with other energy firms, enhancing its operational capabilities and expanding its reach in the energy market.

Centrais Eletricas Brasileiras SA - Eletrobras Earnings Call Summary

Earnings Call Date:May 14, 2025

(Q1-2025)

% Change Since: -3.52%|

Next Earnings Date:Aug 06, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted significant achievements in cost reduction and sustainability initiatives, alongside challenges such as adjusted losses and market risks. Despite positive steps towards growth and environmental goals, financial setbacks and market strategy misalignments posed challenges.

Q1-2025 Updates

Positive Updates

Partial Sale of Amazon Thermal Plants

Eletrobrás completed a partial sale of Amazon thermal plants, receiving R$2 billion in cash. The transaction aligns with the company's commitment to net-zero emissions by 2030.

Cost Reduction Achievements

Operational costs dropped by 28% compared to Q4 2024 and by 8% year-on-year, with personnel cost savings of R$143 million.

Energy Trading Growth

There was a 35% increase in the free market energy trading year-on-year, reaching 722 customers.

Sustainability Initiatives

Launched a sustainability report for 2024, with initiatives such as partnerships for electrical cars and decarbonization in ports, and the birth of the first Amazonian manatee calf in five years.

Negative Updates

Adjusted Loss for Q1 2025

Eletrobrás reported an adjusted loss of R$81 million, primarily due to the regulatory remeasurement of Chesf for transmission.

Submarket Risk and Price Mismatches

Hedging strategy led to price mismatches between the North/Northeast and Southeast markets, impacting Q1 2025 results.

Decline in Transmission Revenue

Transmission revenue experienced a drop, partially offsetting generation revenues, contributing to a 4% decline in regulatory adjusted EBITDA.

Company Guidance

During the first quarter of 2025, Eletrobrás provided several key financial and operational updates in their conference call. The company reported an adjusted loss of R$81 million, primarily due to the regulatory remeasurement of Chesf for transmission, and a significant reduction in operational costs, with a 28% drop compared to the fourth quarter of 2024 and an 8% year-on-year decrease, saving R$143 million in personnel. Energy trading in the free market saw a 35% year-on-year increase. The company received R$2 billion in cash from a partial sale of Amazon thermal plants and continued efforts to divest its stake in the Angra nuclear plant, while confirming ongoing investments to complete the Angra nuclear plant. Revenue grew by 16%, although EBITDA saw a 4% decline, influenced by transmission revenue drops and a mismatch in sales exposure. Eletrobrás emphasized its commitment to operational excellence, with high availability of generation and transmission equipment, and significant developments in sustainability initiatives, including a partnership with Estapar for electric vehicles and efforts to promote decarbonization in ports. Looking ahead, the company plans to maintain a balanced energy portfolio and continue optimizing its PMSO, aiming for a figure slightly below R$6 million for the year.

Centrais Eletricas Brasileiras SA - Eletrobras Financial Statement Overview

Summary

Centrais Eletricas Brasileiras SA shows strong financial performance with consistent revenue growth and high profitability margins. Effective cash flow management and a stable balance sheet with prudent leverage enhance its financial profile.

Income Statement

Very Positive

Centrais Eletricas Brasileiras SA has demonstrated strong financial performance with consistent revenue growth, particularly a TTM growth rate of 4.23%. Gross profit margin is impressive at 83.15% TTM, indicating efficient cost management. Net profit margin is robust at 23.15% TTM, reflecting strong profitability. EBIT and EBITDA margins are also high, suggesting effective operational control and healthy earnings before interest, taxes, depreciation, and amortization.

Balance Sheet

Positive

The company maintains a stable balance sheet with a moderate debt-to-equity ratio of 0.60, indicating manageable leverage. The equity ratio of 43.08% demonstrates a solid foundation of equity financing. Return on equity at 7.98% TTM reflects decent profitability relative to shareholders' equity. Overall, the balance sheet shows a stable financial position with effective management of liabilities and equity.

Cash Flow

Very Positive

Eletrobras has shown strong cash flow performance with a significant operating cash flow to net income ratio of 1.45, indicating efficient conversion of income into cash. Free cash flow to net income ratio of 1.18 reflects the ability to generate surplus cash after capital expenditures. The free cash flow growth rate of 22.69% demonstrates an upward trend in cash flow generation, supporting future investments and debt servicing.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
41.88B	40.18B	37.16B	34.07B	37.62B	29.08B
	Gross Profit
34.82B	21.76B	18.49B	18.22B	25.66B	15.65B
	EBIT
12.30B	19.61B	11.02B	5.69B	13.40B	6.94B
	EBITDA
19.99B	20.73B	11.81B	9.07B	14.08B	11.33B
	Net Income Common Stockholders
9.70B	10.38B	4.55B	2.65B	5.65B	6.39B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
30.28B	29.83B	15.97B	23.62B	16.53B	14.33B
	Total Assets
282.02B	289.87B	267.06B	270.22B	188.30B	178.97B
	Total Debt
73.45B	78.24B	63.15B	61.15B	46.14B	49.10B
	Net Debt
50.79B	51.66B	50.10B	49.72B	45.94B	48.82B
	Total Liabilities
160.44B	167.87B	154.59B	159.19B	111.89B	105.22B
	Stockholders Equity
121.49B	121.86B	112.33B	110.50B	76.12B	73.48B
Cash Flow		Free Cash Flow
11.39B	9.29B	4.12B	-24.35B	-10.92B	1.80B
	Operating Cash Flow
14.02B	12.39B	8.24B	9.28B	-8.23B	4.20B
	Investing Cash Flow
-6.47B	-8.66B	827.04M	-28.80B	123.99M	2.44B
	Financing Cash Flow
3.63B	9.80B	-6.76B	30.07B	-8.45B	-6.69B

Centrais Eletricas Brasileiras SA - Eletrobras Technical Analysis

Technical Analysis Sentiment

Positive

Last Price7.40

Price Trends

50DMA

7.38

Positive

100DMA

6.98

Positive

200DMA

6.60

Positive

Market Momentum

MACD

0.03

Negative

RSI

49.07

Neutral

STOCH

65.67

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EBR, the sentiment is Positive. The current price of 7.4 is below the 20-day moving average (MA) of 7.40, above the 50-day MA of 7.38, and above the 200-day MA of 6.60, indicating a neutral trend. The MACD of 0.03 indicates Negative momentum. The RSI at 49.07 is Neutral, neither overbought nor oversold. The STOCH value of 65.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EBR.

Centrais Eletricas Brasileiras SA - Eletrobras Risk Analysis

Centrais Eletricas Brasileiras SA - Eletrobras disclosed 61 risk factors in its most recent earnings report. Centrais Eletricas Brasileiras SA - Eletrobras 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

Centrais Eletricas Brasileiras SA - Eletrobras Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EBR	78 Outperform	$17.22B	9.49	8.58%	7.51%	0.18%	99.46%
LNT	75 Outperform	$15.44B	20.73	10.71%	3.38%	2.46%	5.66%
CMS	73 Outperform	$20.58B	20.35	12.53%	3.15%	5.87%	3.59%
EBR.B	73 Outperform	$17.22B	10.60	8.58%	0.94%	0.18%	99.46%
EVRG	69 Neutral	$15.37B	17.60	8.95%	4.00%	5.53%	23.00%
EIX	67 Neutral	$19.42B	7.16	17.93%	6.56%	5.36%	209.92%
Sector *	64 Neutral	$8.53B	10.36	4.25%	5.86%	4.06%	-12.76%

* Utilities Sector Average

Performance Comparison

EBR

Centrais Eletricas Brasileiras SA - Eletrobras

7.40

1.27

20.72%

LNT

Alliant Energy

60.01

10.74

21.80%

EBR.B

Centrais Elc Braz Pfb B Elbras

8.26

1.76

27.08%

CMS

CMS Energy

68.79

11.04

19.12%

EIX

Edison International

50.46

-17.98

-26.27%

EVRG

Evergy

66.79

16.28

32.23%

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.