Petroleo Brasileiro SA- Petrobras (PBR) AI Stock Analysis

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Petroleo Brasileiro SA- Petrobras

(NYSE:PBR)

Rating:73Outperform

Price Target:

$13.50

▲(10.57% Upside)

Petrobras scores well due to its strong financial performance and attractive valuation, supported by strategic production increases and efficient management. However, technical indicators suggest caution, and challenges in revenue growth and cash flow need addressing.

Positive Factors

Management Strategy

Cost-cutting measures and a focus on capital discipline improve the risk/reward profile for PBR, highlighting management's proactive approach to navigating lower oil prices.

Production Growth

The ramp-up of new platforms is expected to contribute to PBR's output growth target, offering potential upside to production levels.

Negative Factors

Dividend

Petrobras announced a lower-than-expected dividend for 4Q24, which implies a yield well below expectations.

Financial Performance

4Q24 adjusted EBITDA came in 6% below consensus, with the Upstream segment underperforming.

Petroleo Brasileiro SA- Petrobras (PBR) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$75.25B

Dividend Yield13.66%

Average Volume (3M)22.82M

Price to Earnings (P/E)5.8

Beta (1Y)0.12

Revenue Growth-13.68%

EPS Growth-13.96%

CountryUS

Employees41,778

SectorEnergy

Sector Strength58

IndustryOil & Gas Integrated

Share Statistics

EPS (TTM)0.76

Shares Outstanding3,721,115,700

10 Day Avg. Volume19,941,093

30 Day Avg. Volume22,818,510

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap1.86

Enterprise Value/Revenue1.57

Enterprise Value/Gross Profit3.17

Enterprise Value/Ebitda4.74

Forecast

1Y Price Target

$14.28

Price Target Upside16.95% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering4

Petroleo Brasileiro SA- Petrobras Business Overview & Revenue Model

Company DescriptionPetroleo Brasileiro SA - Petrobras (PBR) is a state-controlled oil and gas company based in Brazil. It operates in various sectors, including exploration and production of oil and natural gas, refining, distribution, and marketing of oil products, as well as biofuels and renewable energy sources. Petrobras is one of the largest producers of oil in Brazil and plays a vital role in the country's energy sector, focusing on offshore oil fields and leveraging advanced technology for exploration and extraction.

How the Company Makes MoneyPetrobras generates revenue primarily through the sale of crude oil, natural gas, and refined petroleum products. Its key revenue streams include upstream activities, which involve exploration and production of oil and gas, contributing significantly to its income. The company also earns revenue from refining operations, where crude oil is processed into various products such as gasoline, diesel, and kerosene. Additionally, Petrobras has a growing focus on biofuels and renewable energy, which adds another layer to its revenue model. The company benefits from partnerships and strategic alliances, particularly in offshore exploration projects, which help reduce costs and share risks. Furthermore, changes in global oil prices and domestic fuel prices set by the Brazilian government can significantly impact its earnings, making market dynamics an important factor for its financial performance.

Petroleo Brasileiro SA- Petrobras Earnings Call Summary

Earnings Call Date:Aug 07, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Nov 06, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted significant achievements in production and CapEx execution, offsetting some of the negative impacts of falling oil prices. The company is on track with its production targets and has demonstrated operational efficiency and strategic planning. However, the decline in oil prices and its impact on financial results present ongoing challenges.

Q2-2025 Updates

Positive Updates

Increased Oil Production

In Q2 2025, Petrobras produced 2.3 million barrels of oil per day on average, a 5% increase compared to Q1 2025 and an 8% increase compared to the same period last year. In July 2025, production further increased to 2.47 million barrels per day.

CapEx Execution Success

Petrobras increased its CapEx in Q4 2024 to align with its guidance, resulting in a production ramp-up. In 2025, over 50 wells were linked by mid-year, surpassing the total number for the entire year of 2024.

Record Total Production

The company achieved a record total production of 4.2 million barrels of oil equivalent per day in Q2 2025.

Commercial Gas Production Growth

Petrobras increased its gas supply to the market by 15%, aided by the progress of the Rota 3 pipeline and the Boaventura gas processing unit.

Negative Updates

Falling Oil Prices Impact

In Q2 2025, the average oil price was $68 per barrel, a 10% decrease compared to the previous year, impacting financial results.

Operational Cash Flow Decline

Operating cash flow was $7.5 billion, a decline from the previous quarter, influenced by non-recurring events such as the absence of PIS/COFINS tax credits and higher selling expenses due to increased crude oil export volumes.

Company Guidance

During the Petrobras earnings call for the second quarter of 2025, several key metrics were highlighted. The company reported an impressive production increase, reaching 2.3 million barrels of oil per day on average, which is a 5% increase compared to the first quarter of 2025 and an 8% rise compared to the same period last year. This ramp-up was attributed to a strategic increase in CapEx during the fourth quarter of the previous year, which aligned with their production guidance. By July 2025, production further increased to 2.47 million barrels per day. Despite a 10% decline in Brent oil prices, from $75 to $67, Petrobras maintained a strong financial performance with a net income of $4.1 billion and an EBITDA of $10.2 billion, excluding one-off events. The company emphasized its commitment to cost reduction and efficient management, achieving a total production record of 4.2 million barrels of oil equivalent per day. Additionally, Petrobras increased its gas supply by 15%, thanks to the Rota 3 pipeline and Boaventura gas processing unit. The call also mentioned an investment plan of $18.5 billion for the year, with a focus on production efficiency and strategic project execution.

Petroleo Brasileiro SA- Petrobras Financial Statement Overview

Summary

Petrobras exhibits strong profitability and cash flow generation capabilities, supported by efficient operations and moderate leverage. Challenges include declining revenue growth and a slight decrease in return on equity, but overall financials indicate a well-managed and financially stable entity.

Income Statement

Very Positive

Petrobras has shown strong profitability with a gross profit margin of 49.7% and an EBIT margin of 26.8% in TTM (Trailing-Twelve-Months), indicating operational efficiency. However, the revenue growth rate has been negative over the past year, suggesting a contraction in top-line performance. Despite this, the net profit margin remains robust at 9.8%, showcasing effective cost control and profitability.

Balance Sheet

Positive

The company's balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.94, indicating moderate leverage. The equity ratio stands at 34.5%, which underscores strong equity financing. However, the return on equity has decreased to 12.7% in the TTM, suggesting reduced efficiency in generating profits from shareholders' equity.

Cash Flow

Very Positive

Petrobras has demonstrated strong cash flow generation with an operating cash flow to net income ratio of 4.24, indicating efficient cash generation from operations. Free cash flow remains positive, though it has declined compared to previous periods. The free cash flow to net income ratio of 2.41 reflects solid ability to generate cash relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	88.72B	91.42B	102.41B	124.47B	83.97B	53.68B
Gross Profit	44.10B	45.97B	53.97B	64.99B	40.80B	24.49B
EBITDA	29.46B	31.86B	52.30B	70.05B	44.90B	16.99B
Net Income	8.72B	6.79B	24.88B	36.62B	19.88B	1.14B
Balance Sheet
Total Assets	199.87B	181.65B	217.07B	187.19B	174.35B	190.01B
Cash, Cash Equivalents and Short-Term Investments	7.67B	7.53B	15.55B	10.77B	11.12B	12.37B
Total Debt	64.49B	60.31B	62.60B	53.80B	58.74B	75.54B
Total Liabilities	130.63B	122.30B	138.09B	117.36B	104.54B	130.13B
Stockholders Equity	68.93B	59.11B	78.58B	69.49B	69.41B	59.35B
Cash Flow
Free Cash Flow	21.04B	21.27B	31.10B	40.14B	31.47B	23.02B
Operating Cash Flow	37.01B	36.09B	43.21B	49.72B	37.79B	28.89B
Investing Cash Flow	-11.81B	-13.37B	-7.96B	-432.00M	2.16B	-4.51B
Financing Cash Flow	-31.35B	-33.09B	-30.70B	-51.45B	-40.79B	-19.26B

Petroleo Brasileiro SA- Petrobras Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price12.21

Price Trends

50DMA

12.30

Negative

100DMA

11.85

Positive

200DMA

12.24

Negative

Market Momentum

MACD

0.02

Negative

RSI

50.13

Neutral

STOCH

66.11

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PBR, the sentiment is Neutral. The current price of 12.21 is above the 20-day moving average (MA) of 12.06, below the 50-day MA of 12.30, and below the 200-day MA of 12.24, indicating a neutral trend. The MACD of 0.02 indicates Negative momentum. The RSI at 50.13 is Neutral, neither overbought nor oversold. The STOCH value of 66.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PBR.

Petroleo Brasileiro SA- Petrobras Peers Comparison

Overall Rating

UnderperformOutperform

Sector (65)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TTE	78 Outperform	$135.56B	10.71	10.96%	5.80%	-10.73%	-36.76%
E	78 Outperform	$52.18B	19.63	4.83%	6.95%	-6.31%	-33.87%
SHEL	74 Outperform	$206.30B	15.91	7.47%	3.96%	-5.75%	-20.18%
PBR	73 Outperform	$75.25B	5.75	19.48%	13.66%	-13.68%	-13.96%
EQNR	71 Outperform	$60.39B	7.87	19.22%	8.99%	1.19%	-7.87%
Sector *	65 Neutral	$15.01B	7.39	3.39%	5.33%	4.10%	-61.80%
BP	65 Neutral	$86.76B	143.77	0.95%	5.67%	-7.40%	-90.89%

* Energy Sector Average

Performance Comparison

PBR

Petroleo Brasileiro SA- Petrobras

12.21

-0.91

-6.94%

33.93

3.98

13.29%

Eni SPA

34.18

4.54

15.32%

SHEL

Shell

71.60

6.93

10.72%

EQNR

Equinor ASA

23.81

0.61

2.63%

TTE

TotalEnergies

60.95

-3.46

-5.37%

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: Aug 26, 2025