Bradesco plummets as profit misses estimates, bigly
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 07 2024
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About BBD
Banco Bradesco SA is a Brazil-based company which engages in the banking services industry. The Company is a multiple-service bank, operating primarily in two segments: financial and insurance. The financial segment includes several areas of the banking sector, serving individual and corporate clients, acting as an investment bank in domestic and international banking operations, investment fund administration, consortium administration, and asset management. The insurance segment includes life insurance, supplementary pension plans, health, accident, and property insurance. The Company provides services to other entities which include asset management and treasury services, foreign exchange transactions, corporate finance and investment banking services, hedging operations, and financing operations, including working capital financing, leasing, and installment credit.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Strong Revenue Growth: The company achieved $9.55 billion in revenue for the year, marking a 9.8% year-over-year increase and exceeding market expectations by $180 million, indicating sustained demand and market share expansion in the aviation sector.
- Adjusted EBITDA Improvement: Adjusted EBITDA rose 15% year-over-year to $1.559 billion, with the EBITDA margin expanding by 60 basis points to 16.3%, showcasing the company's success in cost control and operational efficiency.
- Significant Net Income Increase: Adjusted net income grew to $805 million, a 47% year-over-year increase, which not only enhances the company's financial health but also provides funding for future investments and expansion.
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- Market Confidence Rebound: While the bank's performance has improved, analysts caution that despite the overall recovery in the Brazilian banking sector, it is still too early to adopt an aggressive investment strategy to mitigate risks.
- Historical Performance Data: Banco Bradesco's historical financial data and dividend scorecard demonstrate its stability in the market, further enhancing investor confidence in its long-term growth prospects.
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Canada's Industry Minister Affirms Ottawa's Commitment to Support Bombardier After Discussing with CEO
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See More
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- Earnings Beat: Bombardier reported a FY 2023 non-GAAP EPS of $7.72, surpassing expectations by $1.46, which reflects a significant enhancement in profitability and boosts investor confidence.
- Strong Revenue Growth: The company achieved $9.55 billion in revenue for the year, marking a 9.8% year-over-year increase and exceeding market expectations by $180 million, indicating sustained demand and market share expansion in the aviation sector.
- Adjusted EBITDA Improvement: Adjusted EBITDA rose 15% year-over-year to $1.559 billion, with the EBITDA margin expanding by 60 basis points to 16.3%, showcasing the company's success in cost control and operational efficiency.
- Significant Net Income Increase: Adjusted net income grew to $805 million, a 47% year-over-year increase, which not only enhances the company's financial health but also provides funding for future investments and expansion.
See More
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- Earnings Per Share Growth: Banco Bradesco reported an earnings per common share of R$2.13 for FY 2023, indicating a significant recovery in profitability and an increase in market confidence compared to the previous year.
- Net Interest Income Increase: The bank's net interest income rose to R$73.27 billion, up 8.3% from R$67.45 billion a year ago, reflecting robust growth in its lending operations and an improved interest rate environment.
- Market Confidence Rebound: While the bank's performance has improved, analysts caution that despite the overall recovery in the Brazilian banking sector, it is still too early to adopt an aggressive investment strategy to mitigate risks.
- Historical Performance Data: Banco Bradesco's historical financial data and dividend scorecard demonstrate its stability in the market, further enhancing investor confidence in its long-term growth prospects.
See More
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- Market Performance Comparison: In 2022, Canada's S&P/TSX Composite Index rose by 28.3%, marking the first time it outperformed the S&P 500's 16.4% gain in a bull market, highlighting the strength of the Canadian market and attracting investor interest.
- Sector Structure Differences: Unlike the U.S. market where tech stocks account for one-third, Canadian tech stocks make up only 10%, allowing the market to remain insulated from tech bubble concerns and maintain stable growth potential.
- Interest Rate Environment Impact: With Canadian interest rates at 2.3%, significantly lower than the U.S. range of 3.5%-3.75%, Canadian financial firms benefit from a more favorable financing environment, boosting stock prices, particularly in infrastructure and defense sectors.
- Investment Opportunities: The iShares MSCI Canada ETF achieved a 36% return in 2025, with an average annual return of 14.12% over the past five years, providing investors with a simple and diversified way to capitalize on the undervalued Canadian stocks in the current market context.
See More
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- Revenue Growth Expectations: The revenue is projected to reach $9.37 billion, representing a 7.7% year-over-year increase, suggesting positive performance in business expansion and market demand, which could further bolster investor confidence.
- Historical Performance Review: Over the past two years, Bombardier has beaten EPS estimates 88% of the time and revenue estimates 63% of the time, and this strong performance record may positively influence the upcoming earnings report.
- Valuation Risk Warning: Despite the optimistic growth outlook, Bombardier has been downgraded by Wolfe Research due to rising valuation risks, prompting investors to carefully assess future investment decisions.
See More
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Collaboration with FAA: Canada is working with the Federal Aviation Administration (FAA) to address outstanding certification issues.
Involvement of Key Companies: The collaboration involves Bombardier and General Dynamics, indicating a focus on resolving certification matters in the aviation sector.
See More
Canada's Industry Minister Affirms Ottawa's Commitment to Support Bombardier After Discussing with CEO
Canadian Industry Minister's Support: The Canadian Industry Minister has expressed support for Bombardier, indicating a commitment to assist the firm.
Communication with CEO: The Minister has communicated directly with Bombardier's CEO regarding the company's needs and future plans.
See More
