JPMorgan Econ FI-Globo Stay tuned for better valuations-107270610

JPMORGANLatinAmericaCreditResearch28March2024GloboNeutralStaytunedforbettervaluationsGLOPARGloboreportedagoodquarter,where,despitelowerrevenues,EBITDAMoody's:Ba2Outlook:NEGATIVincreasedandFCFwashealthy.RevenuesofBRL4,043millionwerestableEsequentiallybut10%loweryoy,mainlyonloweradvertisingandcontentrevenuesS&P:BB+Outlook:duetotheabsenceoftheWorldCup.ThelackofbigeventsalsodroveasignificantOutlook:STABLEdeclineintransmissionandexhibitionexpenses,whichinturndrovea-29%yoyFitch:BB+declineintotalcostsandtookEBITDAtoBRL304million,down22%qoqbutupSTABLEfromnegativeterritoryin4Q22.Marginsstoodat7.5%,downfrom9.6%in3Q23butsignificantlybetterthanthenegativemarginin4Q22.WecalculatethatFCFTheaboveagencyratingsareatthecorporatelevelafterdividendswasBRL246millionin4Q23,taking2023cashgenerationtoBRL243million.CashflowscontinuedtobenefitfromfinancialincomerelatedtotheLatinAmericaCorporateResearchcompany’slargeliquidityposition,whichasof4Q23coveredtotaldebtby2.5x.Onvaluations,bondshavehaddecentperformanceinthelastmonth,relativelyinEduardoNietoAClinewithsimilarlyratedTMTpeers,butcontinuetotradeamongthewidestintheBBuniverse.Despitebeingopticallyattractive,spreadsareneartheLTMtights,(1-212)622-4939andtherelationshipwithTMTpeersisrelativelyinlinewithLTMaverages.eduardo.nietoleal@jpmorgan.comComparedtothesovereign,thepickupof~180bpis...