a Telefonica Brazil (VIVT3), owner Aliveis getting closer to getting Financial Services License at the Central BankThe company's CEO said on Tuesday (30).
“The license has not been issued, but we are in the final stage,” Christian Gebara said in a conference call with journalists on the second quarter balance sheet – released yesterday (29) after the markets closed.
The CEO also said that the company is currently leasing a license to offer credit products in “Bank as a ServiceFrom third parties.
According to Jabara, the company intends to advance in this sector, and the BC license will allow for cost reduction as the company will be able to provide financial services to customers directly.
The company aims for a “more conservative” investment-to-revenue ratio and has lowered the ratio from 15.9% in the first half of 2023 to 15.5% in the first half of this year.
We grow in recipes that don't require that. capex “(Investments),” the executive said, citing service offerings in areas such as health and entertainment, as well as finance.
In recent months, the Vivo owner has focused on offering complementary telecom services to diversify revenue streams and has sought to be more conservative in investments.
Vivo shares fall after balance sheet
However, this announcement was not enough to contain the negative reaction to Telefônica's balance sheet.
The stock is trading in a negative tone compared to Ibovespa. VIVT3 started its trading on a high note, but quickly lost its strength and recorded an intraday low of R$47.10, down 2.38% in the first hour of trading. Follow in real time.
Vivo owner's net profit grew by 8.9% in the second quarter of 2024 compared to the same period in 2023, reaching R$1.222 billion.
EBITDA (earnings before interest, taxes, depreciation and amortization) increased by 7.3% year-on-year to R$5.455 billion. The EBITDA margin remained stable at 39.9%.
The company's net operating income increased by 7.4%, reaching a total of R$13.679 billion. The performance was driven by the mobile segment, with an increase of 8.8%.
In Citi's assessment, the company maintained a high pace of revenue growth in the second quarter, but some expense lines put pressure on margins, again, taking “a little bit of the shine” out of the results.
XP analysts highlight that Telefônica's net profit was below expectations, but they estimate that free cash flow generation remains strong with net profit growth in the year-on-year comparison.
“The investment thesis remains sound, combining defensiveness, dividend yields and growing cash flow,” analysts Bernardo Guttmann and Marco Nardini wrote.
BTG Pactual reiterated that Vivo shares are a good option for investors looking for safer securities, with a higher sector premium and dividend yield (Profit return) by 9% in 2024.
The above mentioned banks reiterated their buy recommendation on VIVT3 shares after the balance sheet.
*With information from Reuters
The journalist graduated from PUC-SP. He is a reporter for MoneyTimes and has worked for Seu Dinheiro and the political analysis department of XP Investimentos.
The journalist graduated from PUC-SP. He is a reporter for MoneyTimes and has worked for Seu Dinheiro and the political analysis department of XP Investimentos.
Charlotte Whitmore is a contributor at Mediarunsearch.co.uk, covering a broad range of topics including news, politics, business, technology, sport, entertainment, and lifestyle. She focuses on delivering clear, balanced reporting and practical information that helps readers stay informed about current events and emerging developments. Her work highlights stories that matter to everyday audiences, with an emphasis on accuracy, relevance, and accessible journalism that keeps readers connected to the issues shaping the UK and beyond.