Daily Stock Analysis: Petrobras (PBR)

Petroleo Brasileiro SA Petrobras, known by the ticker symbol PBR, is the largest Integrated energy company in Brazil and operates in the Energy business sector. This is my first report on PBR for my Viital stock portfolio. I have not reviewed PBR in the past three years for any of the portfolios seven portfolios I've collected so-far).

Petrobras is a Brazil-based integrated energy company controlled by the Brazilian government. The company focuses on exploration and production for oil and gas in Brazilian offshore fields. Production in 2020 was 2.8 million barrels of oil equivalent a day (83% oil production), and reserves stood at 8.8 billion boe (86% oil). 


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Petrobras operates 13 refineries in Brazil with a capacity of 2.2 million barrels a day and distributes refined products and natural gas throughout Brazil.

Petrobras was founded in 1953 and is headquartered in Rio de Janeiro, Brazil.

Three key data points gauge any dividend equity or fund such as Petroleo Brasileiro SA Petrobras  (PBR):

(1) Price

(2) Dividends

(3) Returns
Those three basic keys best tell whether any company has made, is making, and will make money. 

PBR Price

Petrobras's price per share was $10.79 as of Thursday's market close. One year ago its price was $10.97 Thus, Petrobras's share price fell eighteen cents or 1.6% in the past year.

If PBR's stock trades in the range of $7.00 to $15.00 this next year, its recent $10.79 share price might rise by $2.21 to reach $13.00 by December 27, 2022. My estimate is $1.05 lower than the median of 1yr price estimates from thirteen analysts who track PBR for brokerages.

PBR Dividends

Petrobras's most recent semi-annual dividend of  $1.1725 was paid out December 22nd, to shareholders of record December 2nd. That semi-annual dividend and the one previously paid equal to $1.79 annually and yield 16.62% per yesterday's $10.79 closing price. 

Petroleo Brasileiro SA Petrobras (PBR) has paid variable dividends annually, semi-annual or quarterly dividends since May 11, 2001. That will be 20 years come May.

PBR Returns

Adding the $1.79 annual estimated Petrobras forward-looking dividend to my $2.21 price upside estimate shows a $4.00 potential gross gain, per share, to be reduced by any costs to trade PBR shares.  

At yesterday's $10.79 price per share, a little over $1000 would buy 93 shares.

A $10 broker fee (if charged) would be paid half at purchase and half at sale and might cost us about $0.11 per share.

Subtract that maybe $0.11 brokerage cost from my estimated $4.00 gross gain per share results in a net gain of $3.89 X 93 shares = $361.77 for a 36.15% net gain on a $1,003.47  investment.

So it is that Petroleo Brasileiro SA Petrobras  (PBR) shows a possible 36.15% net gain including a 16.62% forward estimated dividend yield. 

Over the next year at this time, a $1000 investment in Petroleo Brasileiro SA Petrobras (PBR) could generate $166.20 in cash dividends alone. Note that a single share of PBR stock bought at Thursday's closing price was $10.79. Therefore, PBR share price is more than fifteen times smaller than the dividend income from $1000.00 invested. Thus, according to my dogcatcher ideal, now is a prime time to pick up Petroleo Brasileiro SA Petrobras (PBR) shares. The estimated next-year dividend from $1K invested is 15.4 times PBR's single share price. Consider yourself alerted. It's a sign!   

All of the estimates above are speculation based on the past history of Petroleo Brasileiro SA Petrobras (PBR) Only time and money invested in this stock will determine its market value.

Disclaimer:   This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a ...

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