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TIMB - TIM S.A.: Sector Challenges And Unattractive Valuation
TIM S.A. American Depositary Shares (Each representing 5)
2024-05-14 15:03:19 ET
Summary
Investors who focus on dividends normally look for sectors such as telecom, due to their predictability, but this does not happen in Brazil.
TIM S.A. trades at a P/B of 1.5x, which is not considered cheap compared to its Telefônica Brasil peer.
Recent climate events in the state of Rio Grande do Sul may negatively impact TIM S.A.'s revenue in the short term.
Investment Thesis
I recommend selling TIM S.A. ( TIMB ) shares. TIM is considered a defensive company, however, I do not believe that the characteristics of the sector and the Brazilian competitive environment can provide this....