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Companhia De Saneamento
(NYSE:SBS)
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Rating:62Neutral
Price Target:
$5.00
â–Ľ(-11.97% Downside)
Action:Reiterated
Date:08/17/26
The score is mainly supported by very attractive valuation (low P/E and a reasonable yield), but is held back by weakening financial quality—especially negative TTM free cash flow and higher leverage—and bearish technical momentum with the stock trading below all major moving averages.
Positive Factors
Regulated water utility model
Operating in regulated water supports recurring demand and essential-service relevance. This can provide a durable revenue base and visibility across the next several months, although execution and regulatory obligations remain important.
Negative Factors
Sharp increase in leverage
The substantial debt increase raises refinancing and interest sensitivity while reducing financial flexibility. Higher leverage can constrain future investment choices and amplify pressure on earnings if funding costs remain elevated or capital needs expand.
Read all positive and negative factors
Positive Factors
Negative Factors
Regulated water utility model
Operating in regulated water supports recurring demand and essential-service relevance. This can provide a durable revenue base and visibility across the next several months, although execution and regulatory obligations remain important.
Read all positive factors
Companhia De Saneamento (SBS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$16.23B
Dividend Yield2.91%
Average Volume (3M)5.95M
Price to Earnings (P/E)3.0
Beta (1Y)0.34
Revenue Growth9.43%
EPS Growth-22.80%
CountryUS
Employees8,717
SectorUtilities
Sector Strength65
IndustryRegulated Water
Share Statistics
EPS (TTM)2.27
Shares Outstanding3,524,534,000
10 Day Avg. Volume4,966,937
30 Day Avg. Volume5,946,289
Financial Highlights & Ratios
PEG Ratio-0.79
Price to Book (P/B)2.11
Price to Sales (P/S)2.39
P/FCF Ratio11.27
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$6.40Price Target Upside12.68% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)0.36
Revenue Forecast (FY)$4.95B
Companhia De Saneamento Business Overview & Revenue Model
Company Description
SABESP, or Companhia de Saneamento Básico do Estado de São Paulo, is a key utility provider specializing in water and sewage services for residential, commercial, industrial, and governmental clients. Its offerings are comprehensive, spanning wate...
How the Company Makes Money
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Companhia De Saneamento Earnings Call Summary
Earnings Call Date:Nov 11, 2024
(Q3-2024)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. While there were positive developments in revenue and EBITDA growth, operational cash generation, and new strategic directions post-privatization, significant challenges remain. These include regulatory impacts, transition costs, and construction delays. The company is focused on overcoming these hurdles with a new management team and investment strategies.Positive Updates
Revenue and EBITDA Growth
Net revenue increased by 7%, and EBITDA grew by 17% driven by a 2% increase in volume and pricing adjustments.
Negative Updates
Impact of Regulatory Adjustments
Revenue impacted by regulatory adjustments, including a 1% tariff reduction post-privatization.
Read all updates
Q3-2024 Updates
Positive
Negative
Revenue and EBITDA Growth
Net revenue increased by 7%, and EBITDA grew by 17% driven by a 2% increase in volume and pricing adjustments.
Read all positive updates
Company Guidance
During the Q3 2024 earnings call for SBSP3.SA, the management team provided comprehensive guidance on several financial metrics and strategic initiatives. Daniel Szlak, the CFO, detailed a 7% increase in net revenue, translating into a 17% rise in EBITDA, driven by a 2% growth in volume and pricing adjustments. The company reported a gross revenue impact of approximately BRL 8.8 billion due to deferred revenue adjustments under IFRS 12. Operational cash generation stood at BRL 1.6 billion, reinvested into the asset base. The privatization transition incurred non-recurring costs, yet the company saw a 6.4% tariff readjustment, netting a positive effect of around 5%. Additionally, SABESP completed BRL 1.4 billion in investments this quarter, with expectations to reach BRL 6.5 to 7 billion by year-end, despite transitioning from public to private procurement processes. The call also highlighted the company's strategic focus on universal sanitation, cost control, and an efficient capital structure, aiming to leverage a planned BRL 60 billion investment over five years.Companhia De Saneamento Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
70
Positive
Cash Flow
46
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 40.17B | 37.34B | 36.15B | 25.57B | 22.06B | 19.49B |
| Gross Profit | 14.11B | 13.68B | 19.54B | 9.52B | 7.70B | 6.69B |
| EBITDA | 15.46B | 17.85B | 18.11B | 8.96B | 7.94B | 6.16B |
| Net Income | 7.87B | 8.30B | 9.58B | 3.52B | 3.12B | 2.31B |
Balance Sheet | ||||||
| Total Assets | 119.42B | 106.22B | 80.97B | 61.47B | 57.21B | 53.17B |
| Cash, Cash Equivalents and Short-Term Investments | 17.44B | 12.37B | 5.38B | 3.27B | 3.55B | 3.15B |
| Total Debt | 51.25B | 39.99B | 25.26B | 19.54B | 18.96B | 17.72B |
| Total Liabilities | 74.18B | 63.84B | 44.04B | 31.61B | 29.87B | 28.23B |
| Stockholders Equity | 45.10B | 42.38B | 36.93B | 29.86B | 27.33B | 24.93B |
Cash Flow | ||||||
| Free Cash Flow | -3.61B | 7.93B | 7.30B | 4.71B | 3.89B | 3.86B |
| Operating Cash Flow | 9.09B | 8.21B | 7.40B | 4.85B | 3.97B | 3.91B |
| Investing Cash Flow | -26.24B | -15.41B | -9.98B | -4.91B | -2.88B | -2.66B |
| Financing Cash Flow | 16.83B | 10.12B | 3.42B | -977.84M | 60.30M | -929.02M |
Companhia De Saneamento Technical Analysis
Negative
5.68
Price Trends
5.43
Negative
5.80
Negative
5.52
Negative
Market Momentum
-0.29
Positive
31.22
Neutral
16.88
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SBS, the sentiment is Negative. The current price of 5.68 is above the 20-day moving average (MA) of 5.03, above the 50-day MA of 5.43, and above the 200-day MA of 5.52, indicating a bearish trend. The MACD of -0.29 indicates Positive momentum. The RSI at 31.22 is Neutral, neither overbought nor oversold. The STOCH value of 16.88 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SBS.
Companhia De Saneamento Risk Analysis
Companhia De Saneamento disclosed 39 risk factors in its most recent earnings report. Companhia De Saneamento 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
Companhia De Saneamento Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $3.51B | 24.89 | 13.50% | 2.33% | 13.23% | 12.00% | |
67 Neutral | $26.91B | 24.21 | 10.15% | 2.51% | 6.92% | 4.00% | |
66 Neutral | $11.40B | 21.09 | 8.05% | 3.46% | 9.86% | -16.27% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
65 Neutral | $3.06B | 22.83 | 7.62% | 2.50% | 6.43% | -2.99% | |
65 Neutral | $1.10B | 22.79 | 9.57% | 2.53% | 5.26% | 7.26% | |
62 Neutral | $16.23B | 2.99 | 18.48% | 2.37% | 9.43% | -22.80% |
* Utilities Sector Average
SBS
Companhia De Saneamento
4.63
0.43
10.21%
AWR
American States Water
91.10
18.31
25.16%
AWK
American Water
139.91
-0.66
-0.47%
WTRG
Essential Utilities
41.34
3.64
9.66%
CWT
California Water Service
50.85
5.40
11.88%
MSEX
Middlesex Water Company
59.47
7.35
14.10%
Companhia De Saneamento Corporate Events
SABESP Posts Higher Revenue But Lower Profit in Q2 2026 Amid Rising Leverage
Aug 14, 2026
SABESP reported its quarterly financial information for the three and six months ended June 30, 2026, showing a substantial increase in total assets to about R$119.6 billion from R$104.2 billion at year-end 2025, driven mainly by higher financial ...
Sabesp’s 2Q26 Profit Drops as Investment and Cost Pressures Rise Amid Transformation Drive
Aug 13, 2026
In its second-quarter 2026 results, Sabesp reported that it is advancing a transformation agenda centered on customer satisfaction, with upgrades to service platforms, expanded digital channels, and proactive communication, despite inflationary pr...
SABESP Shareholders Approve Merger of EMAE Shares, Await CVM-Delayed EMAE Vote
Jul 31, 2026
On July 30, 2026, SABESP shareholders at an Extraordinary Shareholders’ Meeting approved the merger into SABESP of all remaining shares of EMAE – Empresa Metropolitana de Águas e Energia S.A. that the company does not already own,...
Sabesp Moves to Fully Absorb EMAE in June 2026 Share Merger Plan
Jun 30, 2026
On June 2026, Sabesp and EMAE executed a merger protocol under which Sabesp will absorb all EMAE shares it does not already own, turning EMAE into a wholly owned subsidiary and delisting its stock from B3’s Traditional segment. The boards of...
Sabesp Reshapes Executive Board With New Customer Experience Directorate
Jun 16, 2026
On June 15, 2026, Sabesp announced changes to its executive board and organizational structure, highlighting a strategic focus on customer service and operational excellence. The company created a new Customer Experience Directorate, appointing ci...
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.