2015 All-Latin America Research Team: Financials/Nonbanks, No. 2: Alexandre Spada & team
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2015 All-Latin America Research Team: Financials/Nonbanks, No. 2: Alexandre Spada & team


< The 2015 Latin America Research Team

Alexandre Spada & teamItaú BBAFirst-place appearances: 0

Total appearances: 4

Team debut: 2012Itaú BBA’s analysts secure second-place honors for a third consecutive year, with São Paulo–based Alexandre Spada leading reporting on 11 regional nonbank financials names. “Most of the companies we cover are based in Brazil and tend to be relatively less affected by the challenging macroeconomic conditions that have prevailed in the country over the last few years,” advises Spada, 32. “With few exceptions the nonbank companies we cover have been combining good, predictable [earnings-per-share] growth rates — in the double-digit range — with high payout ratios.” Clients applaud the team’s ongoing enthusiasm for several of these names, including Cetip and Smiles. “Spada sustained optimistic recommendations throughout last year, betting on rerating processes that gradually materialized,” one fund manager offers. Cetip, Brazil’s largest securities clearinghouse, remains a favorite, with a price objective of 38 reais. Its shares jumped 33.1 percent in 2014, besting their regional peers by 36.8 percentage points. Year to date through mid-July, they climbed 10.3 percent higher, to 35.52 reais, while Latin America’s broad market gained 2.3 percent. Spada and his teammates are also still touting Smiles, the loyalty program arm of airline GOL – Linhas Aéreas Inteligentes. They initiated coverage on the stock in June 2013, assigning it an outperform rating based on a combination of compelling valuation and growth opportunities, and have highlighted their bullish stance repeatedly — updating their target price to reflect the company’s better-than-expected results, the crew chief says. Sure enough, by the middle of last month, Smiles’ stock had rocketed 196.6 percent, to 56.42 reais, while the regional sector rose 2.8 percent. During the trailing 12-month period alone, it soared 61.8 percent, against a 5.9 percent decline for its Latin American peers. The researchers foresee additional upside, pegging the shares at 61 reais. “Alexandre has been pivotal for me on Cetip,” another client declares. “He does excellent fundamental research, knows every detail of the companies he follows and is outstanding in client support. He has a monthly report with volume trends on the exchanges that is a great indicator of how the quarterly numbers will look.”

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