NYSE:SBS

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Companhia de Saneamento Básico do Estado de São Paulo - SABESP

Executive Summary

Companhia de Saneamento Básico do Estado de São Paulo - SABESP provides water and sewage services to residential, commercial, industrial, and governmental customers.


Snowflake Analysis

Average dividend payer and fair value.

Share Price & News

How has Companhia de Saneamento Básico do Estado de São Paulo - SABESP's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SBS's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

2.1%

SBS

-1.7%

US Water Utilities

1.3%

US Market


1 Year Return

-21.2%

SBS

6.2%

US Water Utilities

6.1%

US Market

Return vs Industry: SBS underperformed the US Water Utilities industry which returned 6.4% over the past year.

Return vs Market: SBS underperformed the US Market which returned 6.7% over the past year.


Shareholder returns

SBSIndustryMarket
7 Day2.1%-1.7%1.3%
30 Day-0.6%-0.1%-0.3%
90 Day31.4%-3.6%16.6%
1 Year-19.1%-21.2%8.1%6.2%8.4%6.1%
3 Year8.9%1.7%58.9%49.7%35.8%26.9%
5 Year109.7%88.7%142.2%117.9%62.7%44.7%

Price Volatility Vs. Market

How volatile is Companhia de Saneamento Básico do Estado de São Paulo - SABESP's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Companhia de Saneamento Básico do Estado de São Paulo - SABESP undervalued compared to its fair value and its price relative to the market?

19.27x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: SBS ($10.83) is trading above our estimate of fair value ($2.09)

Significantly Below Fair Value: SBS is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SBS is good value based on its PE Ratio (19.3x) compared to the Water Utilities industry average (33.5x).

PE vs Market: SBS is poor value based on its PE Ratio (19.3x) compared to the US market (16.2x).


Price to Earnings Growth Ratio

PEG Ratio: SBS is good value based on its PEG Ratio (0.7x)


Price to Book Ratio

PB vs Industry: SBS is good value based on its PB Ratio (1.9x) compared to the US Water Utilities industry average (2.3x).


Next Steps

Future Growth

How is Companhia de Saneamento Básico do Estado de São Paulo - SABESP forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

27.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SBS's forecast earnings growth (27.6% per year) is above the savings rate (2.2%).

Earnings vs Market: SBS's earnings (27.6% per year) are forecast to grow faster than the US market (22.8% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: SBS's revenue (8.2% per year) is forecast to grow slower than the US market (9.3% per year).

High Growth Revenue: SBS's revenue (8.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SBS's Return on Equity is forecast to be low in 3 years time (14.2%).


Next Steps

Past Performance

How has Companhia de Saneamento Básico do Estado de São Paulo - SABESP performed over the past 5 years?

23.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SBS has high quality earnings.

Growing Profit Margin: SBS's current net profit margins (11.4%) are lower than last year (17.9%).


Past Earnings Growth Analysis

Earnings Trend: SBS's earnings have grown significantly by 23.9% per year over the past 5 years.

Accelerating Growth: SBS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SBS had negative earnings growth (-29%) over the past year, making it difficult to compare to the Water Utilities industry average (2.3%).


Return on Equity

High ROE: SBS's Return on Equity (9.8%) is considered low.


Next Steps

Financial Health

How is Companhia de Saneamento Básico do Estado de São Paulo - SABESP's financial position?


Financial Position Analysis

Short Term Liabilities: SBS's short term assets (R$5.2B) do not cover its short term liabilities (R$7.0B).

Long Term Liabilities: SBS's short term assets (R$5.2B) do not cover its long term liabilities (R$19.0B).


Debt to Equity History and Analysis

Debt Level: SBS's debt to equity ratio (66.8%) is considered high.

Reducing Debt: SBS's debt to equity ratio has reduced from 83.2% to 66.8% over the past 5 years.

Debt Coverage: SBS's debt is well covered by operating cash flow (34.2%).

Interest Coverage: SBS's interest payments on its debt are well covered by EBIT (14.6x coverage).


Balance Sheet


Next Steps

Dividend

What is Companhia de Saneamento Básico do Estado de São Paulo - SABESP current dividend yield, its reliability and sustainability?

2.37%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SBS's dividend (2.37%) is higher than the bottom 25% of dividend payers in the US market (1.68%).

High Dividend: SBS's dividend (2.37%) is low compared to the top 25% of dividend payers in the US market (4.58%).


Stability and Growth of Payments

Stable Dividend: SBS's dividend payments have been volatile in the past 10 years.

Growing Dividend: SBS's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (45.6%), SBS's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SBS's dividends in 3 years are forecast to be well covered by earnings (23.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.5yrs

Average management tenure


CEO

Benedito Pinto Braga (72yo)

1.58yrs

Tenure

Mr. Benedito Pinto Ferreira Braga, Junior has been the State Secretary of Sanitation and Water Resources since January 2015. Mr. Braga has been Chief Executive Officer and Member of Board of Executive Offi ...


Leadership Team

NamePositionTenureCompensationOwnership
Benedito Pinto Braga
CEO, Member of Board of Executive Officers & Director1.58yrsno datano data
Rui de Britto Álvares Affonso
CFO, Investor Relations Officer & Member of Board of Executive Officers17yrsno datano data
Paulo Yoshimoto
Metropolitan Region Officer & Member of Board of Executive Officersno datano datano data
Adriano Stringhini
Corporate Management Officer & Member of Board of Executive Officersno datano datano data
Ricardo Borsari
Regional Systems Officer & Member of Board of Executive Officersno datano datano data
Alceu Segamarchi
Technology0.42yrno datano data
Marcelo Miyagui
Head of Accountingno datano datano data
Mario Sampaio
Head of Capital Market & Investor Relationsno datano datano data
Silvio Valdrighi
Managing Director of Risk Management and Quality5.5yrsno datano data
João Tonello
Head of the Integrated Planning Department7.5yrsno datano data

5.5yrs

Average Tenure

63.5yo

Average Age

Experienced Management: SBS's management team is seasoned and experienced (5.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Benedito Pinto Braga
CEO, Member of Board of Executive Officers & Director1.58yrsno datano data
Mário Pinto
Chairman2.25yrsno data0.0015% R$115.5k
Reinaldo Guerreiro
Independent Director13.5yrsno datano data
Francisco Luna
Independent Director7.25yrsno datano data
Francisco Luiz Gomide
Independent Director3.25yrsno datano data
Lucas Prado
Independent Director2.92yrsno datano data
Wilson de Mello Neto
Director0.75yrno datano data
Eduardo de Teixeira
Independent Director0.25yrno datano data
Claudia da Silva
Director0.50yrno datano data
Walter Luis Albertoni
Independent Director0.50yrno datano data

2.3yrs

Average Tenure

67yo

Average Age

Experienced Board: SBS's board of directors are not considered experienced ( 2.3 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Companhia de Saneamento Básico do Estado de São Paulo - SABESP's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Companhia de Saneamento Básico do Estado de São Paulo - SABESP
  • Ticker: SBS
  • Exchange: NYSE
  • Founded: 1954
  • Industry: Water Utilities
  • Sector: Utilities
  • Market Cap: R$39.746b
  • Listing Market Cap: R$7.453b
  • Shares outstanding: 683.51m
  • Website: https://www.sabesp.com.br

Number of Employees


Location

  • Companhia de Saneamento Básico do Estado de São Paulo - SABESP
  • Rua Costa Carvalho, 300
  • São Paulo
  • São Paulo
  • 05429-900
  • Brazil

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SBSP3BOVESPA (Bolsa de Valores de Sao Paulo)YesRegistered Common SharesBRBRLJun 1997
SBSNYSE (New York Stock Exchange)SPONSORED ADRUSUSDMay 2002
SAJADB (Deutsche Boerse AG)SPONSORED ADRDEEURMay 2002
SBS NBMV (Bolsa Mexicana de Valores)SPONSORED ADRMXMXNMay 2002

Biography

Companhia de Saneamento Básico do Estado de São Paulo - SABESP provides water and sewage services to residential, commercial, industrial, and governmental customers. It provides water supply, sanitary sewage, urban rainwater management and drainage, urban cleaning, and solid waste management services, as well as related activities, including the planning, operation, maintenance, and commercialization of energy. As of December 31, 2019, the company provided water services through 9.9 million water connections to approximately 27.1 million people; and sewage services through 8.3 million sewage connections to approximately 23.8 million people, as well as operated 81,324 kilometers of water pipes and water transmission lines, and 55,983 kilometers of sewer lines. It also offers water and/or sewage services to other municipalities through special purpose companies. The company was founded in 1954 and is headquartered in São Paulo, Brazil. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/10 00:26
End of Day Share Price2020/07/09 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.