2024-05-14 23:40:50 ET
Summary
- Petrobras' Q1 earnings missed estimates, causing a selloff, but I believe it is just noise as the company's profitability remains unparalleled, allowing to deleverage and keep shareholders happy.
- PBR is increasing CAPEX to build long-term value for shareholders and has improved its financial position.
- The company dominates Brazil's oil and gas sector and is poised for robust oil production in the coming years. The valuation is attractive with significant upside potential.
- Investors face substantial political risks, underscored by the information that the CEO was fired by Brazil's president, but the upside potential outweighs all the risks.
Investment thesis
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For further details see:
Petrobras: Ignore The Noise, Rely On Fundamentals