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Ultrapar Participacoes (UGP)
:UGP
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Ultrapar Participacoes SA
(NYSE:UGP)
Rating:74Outperform
Price Target:
$3.50
▼(-10.26% Downside)
Positive Factors
Financial Health
Ultra's consolidated net debt decreased, indicating improved financial health.
Financial Performance
Ipiranga delivered a stronger-than-expected margin.
Negative Factors
Equity Income
Hidrovias’ equity income contribution was way lower than expected.
Operational Momentum
The lack of operational momentum, due to an oversupply and subdued demand environment, prevents a more bullish outlook on the stock.
Ultrapar Participacoes SA (UGP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.98B
Dividend Yield3.42%
Average Volume (3M)1.72M
Price to Earnings (P/E)7.8
Beta (1Y)0.56
Revenue Growth-6.18%
EPS Growth-9.87%
CountryUS
Employees9,999
SectorEnergy
Sector Strength59
IndustryOil & Gas Refining & Marketing
Share Statistics
EPS (TTM)0.16
Shares Outstanding1,115,849,900
10 Day Avg. Volume1,530,655
30 Day Avg. Volume1,719,165
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 Cap1.71
Enterprise Value/Revenue0.05
Enterprise Value/Gross Profit0.78
Enterprise Value/Ebitda1.00
Forecast
1Y Price Target
$3.75Price Target Upside-3.85% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Ultrapar Participacoes SA Business Overview & Revenue Model
Company DescriptionUltrapar Participacoes SA (UGP) is a Brazilian multinational company operating primarily in the fuel distribution, chemical, and logistics sectors. Founded in 1937 and headquartered in São Paulo, Ultrapar is known for its extensive network of fuel stations under the Ipiranga brand and its presence in the chemical industry through its subsidiary Ultracargo. The company also engages in the production and distribution of specialty chemicals and related products, catering to diverse markets including automotive, agricultural, and industrial applications.
How the Company Makes MoneyUltrapar generates revenue through several key streams. The primary source of income comes from its retail fuel distribution, primarily through Ipiranga-branded gas stations, which sell gasoline, diesel, and other fuel products to consumers. The company also profits from its chemical operations, producing petrochemical products and specialty chemicals that are sold to various industries. Additionally, Ultrapar has a significant logistics segment, managing storage and transportation services for fuels and chemicals, which contributes to its earnings. Strategic partnerships, such as those with suppliers and retailers, enhance its supply chain efficiency and market reach, further bolstering its revenue. Factors like market demand for fuel and chemicals, regulatory changes, and economic conditions in Brazil and surrounding regions also play critical roles in influencing Ultrapar's financial performance.
Ultrapar Participacoes SA Earnings Call Summary
Earnings Call Date:Aug 13, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 12, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook for Ultrapar. While the company achieved strong cash flow, record results at Hidrovias, and a significant increase in net income, it faced challenges in the Ipiranga and Ultragaz segments and regulatory uncertainties in the LPG market.Q2-2025 Updates
Positive Updates
Strong Operational Cash Flow Generation
Despite a BRL 900 million reduction in draft discount due to the IOF tax burden, Ultrapar achieved robust cash flow generation through disciplined working capital management.
Record Results at Hidrovias
Hidrovias has been consolidated into Ultrapar's financials since May, showing record results and demonstrating growth potential.
Significant Increase in Net Income
Net income for the quarter was BRL 1.151 billion, a 134% increase compared to the same period last year, reflecting higher operating results and extraordinary tax credits.
Reduction in Net Debt and Cost of Debt
Ultrapar reported a reduction in net debt and cost of debt, supported by liability management actions after the capital increase.
Successful Share Buyback Program
Completed buyback of 25 million Ultrapar shares at an average cost of BRL 16.64.
Advances in Tax Regulation
Implementation of single-phase taxation of hydrated ethanol and progress in tax evasion measures in São Paulo were highlighted.
Negative Updates
Challenges in Ipiranga Segment
Ipiranga faced a 2% reduction in volume sold and a 13% decrease in recurring EBITDA due to irregularities in biodiesel blend and import parity issues.
Ultragaz Volume Decline
Ultragaz reported a 1% decrease in LPG volume sold, with a 2% decrease in the bottle segment due to market dynamics and cost increases.
Ultracargo Revenue Decline
Ultracargo's revenue decreased by 6%, with a 15% decrease in EBITDA, due to lower demand for storage and initial costs of expansion projects.
Regulatory Challenges in LPG Market
Potential regulatory changes by ANP could endanger population safety and investments in the LPG bottle segment.
Company Guidance
In the earnings release call for the second quarter of 2025, Ultrapar provided an optimistic outlook with several key financial metrics highlighted. The company reported a total EBITDA of BRL 2.07 billion, marking significant growth driven by extraordinary tax credits. The recurring EBITDA was BRL 1.468 billion, a 15% increase from the previous year, bolstered by the consolidation of Hidrovias and improved results from Ultragaz. Net income surged by 134% year-over-year to BRL 1.151 billion, primarily due to higher operating results and extraordinary tax credits amounting to BRL 677 million. CapEx reached BRL 544 million, a 14% increase mainly due to the Hidrovias consolidation, which also contributed BRL 138 million to cash generation. Ultrapar concluded the quarter with a net debt of BRL 12.635 billion, equating to a leverage ratio of 1.9x net debt to EBITDA. The company also completed a buyback program of 25 million shares at an average cost of BRL 16.64 and announced interim dividends of BRL 326 million, or BRL 0.30 per share, to be paid in August. Despite challenges such as irregularities in the fuel sector, Ultrapar remains committed to its robust capital structure and value creation strategy.Ultrapar Participacoes SA Financial Statement Overview
Summary
Ultrapar Participacoes SA demonstrates solid financial performance with consistent revenue growth and improved profitability margins. However, challenges in cash flow management and high leverage levels pose risks to financial stability.Income Statement
Ultrapar Participacoes SA has shown a consistent revenue growth trajectory, with a notable TTM revenue growth rate of 1.25%. The company maintains a stable gross profit margin of around 7%, and its net profit margin has improved to 2.11% TTM. EBIT and EBITDA margins have also shown improvement, indicating enhanced operational efficiency. However, the company faces challenges in maintaining high profitability levels, as evidenced by fluctuating margins over the years.75
Positive
Balance Sheet
The company's debt-to-equity ratio stands at 1.18 TTM, indicating a moderate level of leverage. Return on equity has improved to 19.07% TTM, showcasing effective utilization of equity to generate profits. The equity ratio is stable, reflecting a balanced capital structure. However, the relatively high debt levels could pose risks if not managed carefully.68
Positive
Cash Flow
Ultrapar's cash flow performance shows mixed results. The free cash flow growth rate has declined by 13.17% TTM, indicating potential challenges in generating free cash flow. The operating cash flow to net income ratio is 0.38, suggesting moderate cash generation relative to net income. The free cash flow to net income ratio is 0.45, which is reasonable but indicates room for improvement in cash flow management.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 138.14B | 133.50B | 126.05B | 143.63B | 109.73B | 74.06B |
| Gross Profit | 8.74B | 8.62B | 9.32B | 6.39B | 4.90B | 4.00B |
| EBITDA | 6.81B | 5.06B | 6.36B | 3.25B | 2.76B | 2.56B |
| Net Income | 2.91B | 2.36B | 2.44B | 1.80B | 850.46M | 893.38M |
Balance Sheet | ||||||
| Total Assets | 45.61B | 39.56B | 38.25B | 36.44B | 39.01B | 36.25B |
| Cash, Cash Equivalents and Short-Term Investments | 3.99B | 4.62B | 6.22B | 6.14B | 4.08B | 7.69B |
| Total Debt | 18.94B | 15.79B | 13.30B | 13.28B | 17.73B | 19.21B |
| Total Liabilities | 27.21B | 23.73B | 24.22B | 24.27B | 28.54B | 26.34B |
| Stockholders Equity | 16.07B | 15.16B | 13.51B | 11.71B | 10.07B | 9.53B |
Cash Flow | ||||||
| Free Cash Flow | 1.97B | 1.95B | 2.54B | 785.74M | 1.31B | 2.23B |
| Operating Cash Flow | 3.93B | 3.74B | 3.85B | 2.00B | 2.59B | 3.14B |
| Investing Cash Flow | -2.27B | -6.39B | -1.02B | 7.90B | 724.14M | -2.14B |
| Financing Cash Flow | -2.58B | -1.23B | -2.49B | -6.91B | -3.36B | -592.33M |
Ultrapar Participacoes SA Technical Analysis
Positive
3.90
Price Trends
3.17
Positive
3.08
Positive
2.94
Positive
Market Momentum
0.18
Negative
77.66
Negative
85.87
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UGP, the sentiment is Positive. The current price of 3.9 is above the 20-day moving average (MA) of 3.35, above the 50-day MA of 3.17, and above the 200-day MA of 2.94, indicating a bullish trend. The MACD of 0.18 indicates Negative momentum. The RSI at 77.66 is Negative, neither overbought nor oversold. The STOCH value of 85.87 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UGP.
Ultrapar Participacoes SA 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 | $9.65B | 35.13 | -0.93% | 3.91% | -14.58% | -107.50% | |
74 Outperform | $3.98B | 7.75 | 18.65% | 3.42% | -6.18% | -9.87% | |
65 Neutral | $15.28B | 7.48 | 3.19% | 5.33% | 4.10% | -60.58% | |
58 Neutral | $2.45B | 5.14 | -83.87% | 7.38% | -5.62% | -486.38% | |
55 Neutral | $3.11B | 268.82 | -50.65% | 8.78% | -15.98% | -160.88% | |
51 Neutral | $1.92B | ― | -200.75% | 3.26% | -29.94% | -723.41% | |
51 Neutral | $3.27B | ― | -17.30% | 3.86% | -18.73% | -236.79% |
* Energy Sector Average
Performance Comparison
UGP
Ultrapar Participacoes SA
3.90
-0.23
-5.57%
CVI
CVR Energy
31.43
9.05
40.44%
DK
Delek US Holdings
31.32
13.64
77.15%
DINO
HF Sinclair Corporation
51.10
7.80
18.01%
PBF
PBF Energy
28.51
-2.03
-6.65%
CSAN
Cosan
5.31
-3.80
-41.71%
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.