August 19, 2022
“We are taking advantage of the stock market liquidation to buy,” says the intellectual property manager.  See 3 pending actions - Money Times

“We are taking advantage of the stock market liquidation to buy,” says the intellectual property manager. See 3 pending actions – Money Times

Gabriel Raoni and Intellectual Property Director Bruno Barretto were the guests of the second episode of Market Makers

The recent stock market crash took Ibovespa to the lowest multiple since the 2008 financial crisis. The index is trading at about 6.1 times estimated earnings, well below the 10-year historical average of 11.6 times. Managers already recognized that.

On the second episode of the podcast Marks Marketmade by Thiago Salomao And the Renato Santiago in partnership with Empiricus (observer Money Times), the managers IP CapitalGabriel Raoni and Bruno Barreto say they are raising their profile in Brazilian stocks because of the attractive price tag.

“Bottom Share IP Last year it was three quarters with equity investments there. Now, we’re two-thirds here. Gradually, we are benefiting from the settlement system that is taking place in the Brazilian market,” says Raoni.

However, he points out that Brazil is a “departed” country.

“To invest here, you need meat. Brasilia is always in the way, it’s cyclical. We haven’t increased per capita incomes in 10 years and companies are finding it hard to expand. I’ve always demanded more to come back and this moment is coming,” he adds.

Watch the full episode, where the directors also talked about BTG, XP, and the “harmful effect” of Petrobras:

selectivity

But it can’t just be a company, says the director. IP bets on strategy Investment valueor value investments.

One of the principles of a manager is to invest in companies that are managed by honest and competent businessmen, with indebtedness under control and negotiated at an affordable price.

“You have to be very selective. There are few companies in Brazil with long-term structural growth in a competitive environment,” explains Raoni.

He points out that if we consider the 500 companies listed in Brazil, only 20 companies have growth opportunities at attractive prices.

And among these 20 names, these stocks have always been heavily covered and priced. And what is happening now is that even good companies negotiate very attractive valuations,” he adds.

market makers
“We buy at a low price. We love the healthcare sector, it is an indispensable service,” confirms Raoney (Image: Market Makers)

outstanding business

Among the roles, managers highlight the health sector, more specifically network role (RDOR3) And the havid (HAPV3).

“We buy at a low price. We love the healthcare sector, it is an indispensable service. These companies have gotten stronger during the pandemic,” says Raoney.

per year leaves network role Accumulate a 30% decrease and a 50% decrease in relation to underwritingimplemented in 2020. Hapveda decreases by 34%.

He remembers that his health got messed up because of COVID-19which led to the discontinuation of elective surgeries and an increase in the percentage of lost plans.

The director compares the current moment of the sector with the temporary measure 579, which was amended in 2012 by the then president Dilma RousseffAnd that messed up the electrical system.

This period was the best time to buy well-managed electrical companies. The health sector has been through the chaos of outcomes due to the pandemic. We are in one alcohol marketPeople are getting more impatient,” he argues.

The director also states that firms have an increasing competitive advantage.

“These two companies have done important mergers. In doing so, they tend to solve part of the problem. Health plans are becoming increasingly affordable, so pass on lower prices to customers. They are long-term winners.”

Watch the full episode, where the directors also talked about BTG, XP, and the “harmful effect” of Petrobras:

Back to Itau

Raoney says that after liquidating a position in Itau (ITUB4) In 2018, intellectual property funds returned to purchase company stock.

Ratings are very low. The massive result of Itau Within 20 years, this is due to the ability of the investing bank to increase its capital at ROE (return on equity) by 20%, to become stronger in crises, to reinvest profits. Itai allocates capital very well, and pulls the hare out of the hat in adversity,” he points out.

Barreto also says that the bank faces challenges in the future, such as a flood financial technology that appeared on the market, but, in his opinion, the bank was facing it head on.

“And some of them won’t. Basically, the market puts, in general, a file Itau in a garbage bag. I don’t think Itaú is toxic. It is a well-run bank which is very profitable,” he adds.

The winners

a IP . postslaunched in 1994, and is one of the first funds of independent origin in Brazil, which has collected a return of more than 16,000% since the beginning of the real plan, that is, 100,000 Brazilian reals invested in the fund in July 1994 turned out to be more than 16 million Brazilian Real.

The fund’s last annual loss occurred in 2008 – when there was the major global subprime mortgage crisis. Since the real plan, the fund has only experienced losses in three years – versus 11 years of negative returns from Ibovespa. In the past five years, 41% have returned.

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