Petrobras Reportedly Pulls Back On Dividends
Portfolio Pulse from Lekha Gupta
Petrobras Brasileiro (NYSE:PBR) decided to withhold a proposed extra dividend, initially set at 50% of a potential 44 billion reais ($8.8 billion), following a vote by government-appointed board members. This decision, which surprised investors expecting an extraordinary dividend of $3 billion or more, is now under reconsideration for future disbursement. Brazilian President Luiz Inacio Lula da Silva's government is also planning to revise reserve rules for reinvestment purposes. Despite this, Petrobras reported sales of $27.11 billion, slightly beating consensus but with earnings per ADS missing expectations. PBR shares rose 2.13% to $14.87.
March 12, 2024 | 4:16 pm
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NEUTRAL IMPACT
Petrobras withheld a significant extra dividend, surprising investors but plans for future disbursement and reinvestment are underway. Despite mixed financial results, PBR shares increased.
The withholding of the dividend may initially disappoint investors, but the potential for future disbursement and reinvestment plans could stabilize sentiment. The mixed financial results with sales beating consensus but earnings missing expectations add complexity to the short-term outlook. The recent share price increase suggests a somewhat positive market reaction despite the dividend news.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100