Update shared on 15 Dec 2025
Fair value Decreased 13%Analysts have trimmed their fair value estimate for WEG from R$64 to R$56, reflecting a slightly higher perceived risk. They also highlight stronger long term revenue growth, resilient margins, and Street research pointing to overdone concerns around tariffs and renewable order softness.
Analyst Commentary
Bullish analysts note that recent coverage initiations reinforce the view that WEG is well positioned to outperform, even after the modest reduction in fair value estimates. They argue that the company’s diversified exposure to electrification, automation, and infrastructure provides a solid foundation for above consensus growth and margin resilience.
These analysts also stress that near term tariff and renewables headwinds appear already reflected in the share price, creating a more attractive entry point for long term investors focused on earnings compounding and capital discipline.
Bullish Takeaways
- Bullish analysts highlight a Buy rating and a R$55 price objective as consistent with potential upside from current levels, supported by expectations for robust medium term earnings power.
- They view market worries about tariffs and slower renewables orders as overdone, arguing that the current valuation reflects an excessively bearish scenario for these risks.
- EBITDA forecasts for 2026 to 2027 are running about 7 percent above Street consensus, which these analysts see as signaling confidence in WEG’s execution, pricing power, and operating leverage.
- Supportive commentary around long term demand for electrification and industrial automation is viewed as pointing to structural growth drivers that, in their opinion, can justify premium valuation multiples over time.
What's in the News
- WEG S.A. has called a Special and Extraordinary Shareholders Meeting for December 19, 2025, to be held at its headquarters on Avenida Prefeito Waldemar Grubba, 3,300, in Jaragua do Sul, Santa Catarina, Brazil (company filing).
Valuation Changes
- Fair Value Estimate reduced from R$64 to R$56, signaling a modestly lower intrinsic value despite supportive fundamentals.
- Discount Rate risen slightly from 20.97 percent to 21.76 percent, reflecting a marginally higher perceived risk profile.
- Revenue Growth increased modestly from 13.64 percent to 14.36 percent, indicating a slightly stronger long term top line outlook.
- Net Profit Margin edged up from 17.01 percent to 17.25 percent, pointing to a small improvement in expected profitability.
- Future P/E fallen meaningfully from 46.5x to 39.7x, implying a lower valuation multiple applied to forward earnings.
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