These 4 Measures Indicate That TOTVS (BVMF:TOTS3) Is Using Debt Safely
May 10
Brazilian (BOVESPA) Tech Sector Analysis
UpdatedMay 19, 2024
DataAggregated Company Financials
Companies9
- 7D2.0%
- 3M2.1%
- 1Y-6.3%
- YTD-3.0%
The Tech industry is up 2.0% in the last week, with TOTVS up 2.5%. Meanwhile, Locaweb Serviços de Internet actually underperformed within the industry, shrinking 5.9% in the last week. In the past year, the industry is down 6.3%. As for the next few years, earnings are expected to grow by 28% per annum.
Sector Valuation and Performance
Has the Brazilian Tech Sector valuation changed over the past few years?
| Date | Market Cap | Revenue | Earnings | PE | Absolute PE | PS |
|---|---|---|---|---|---|---|
| Sun, 19 May 2024 | R$33.4b | R$25.0b | R$861.1m | 9.7x | 38.8x | 1.3x |
| Tue, 16 Apr 2024 | R$30.9b | R$24.8b | R$473.3m | 10.9x | 65.2x | 1.2x |
| Thu, 14 Mar 2024 | R$34.3b | R$24.7b | R$556.2m | 13.4x | 61.8x | 1.4x |
| Sat, 10 Feb 2024 | R$32.6b | R$24.8b | R$550.6m | 12.3x | 59.3x | 1.3x |
| Mon, 08 Jan 2024 | R$40.9b | R$28.6b | R$1.2b | 13.1x | 34.6x | 1.4x |
| Wed, 06 Dec 2023 | R$42.4b | R$28.6b | R$1.2b | 13.8x | 35.9x | 1.5x |
| Fri, 03 Nov 2023 | R$36.5b | R$28.5b | R$1.4b | 15.3x | 25.3x | 1.3x |
| Sun, 01 Oct 2023 | R$38.7b | R$28.7b | R$1.5b | 15.4x | 26.5x | 1.3x |
| Tue, 29 Aug 2023 | R$41.3b | R$28.7b | R$1.5b | 18x | 28.4x | 1.4x |
| Thu, 27 Jul 2023 | R$43.1b | R$29.4b | R$1.6b | 20.9x | 26.9x | 1.5x |
| Sat, 24 Jun 2023 | R$43.5b | R$29.4b | R$1.6b | 20.8x | 27.2x | 1.5x |
| Mon, 22 May 2023 | R$41.7b | R$29.4b | R$1.6b | 18.8x | 26x | 1.4x |
| Wed, 19 Apr 2023 | R$38.0b | R$29.5b | R$2.1b | 17.1x | 18.2x | 1.3x |
| Fri, 17 Mar 2023 | R$55.9b | R$41.7b | R$3.5b | 12.6x | 15.8x | 1.3x |
| Sun, 12 Feb 2023 | R$57.9b | R$41.4b | R$3.5b | 10.1x | 16.8x | 1.4x |
| Tue, 10 Jan 2023 | R$58.0b | R$41.8b | R$3.5b | 10.4x | 16.7x | 1.4x |
| Thu, 08 Dec 2022 | R$57.7b | R$42.1b | R$3.5b | 8x | 16.3x | 1.4x |
| Sat, 05 Nov 2022 | R$69.6b | R$41.4b | R$3.6b | 10x | 19.1x | 1.7x |
| Mon, 03 Oct 2022 | R$64.1b | R$41.4b | R$3.4b | 10.4x | 18.8x | 1.5x |
| Wed, 31 Aug 2022 | R$63.8b | R$41.4b | R$3.6b | 10.4x | 18x | 1.5x |
| Fri, 29 Jul 2022 | R$55.3b | R$40.0b | R$3.3b | 9.1x | 16.8x | 1.4x |
| Sun, 26 Jun 2022 | R$51.4b | R$40.0b | R$3.3b | 8.1x | 15.6x | 1.3x |
| Tue, 24 May 2022 | R$53.7b | R$39.5b | R$3.4b | 9x | 15.6x | 1.4x |
| Thu, 21 Apr 2022 | R$61.2b | R$38.3b | R$3.5b | 10.3x | 17.4x | 1.6x |
| Sat, 19 Mar 2022 | R$59.1b | R$38.2b | R$3.7b | 11x | 15.9x | 1.5x |
| Mon, 14 Feb 2022 | R$54.8b | R$37.5b | R$3.7b | 10.7x | 14.9x | 1.5x |
| Wed, 12 Jan 2022 | R$49.9b | R$37.4b | R$3.7b | 10.5x | 13.7x | 1.3x |
| Fri, 10 Dec 2021 | R$62.4b | R$37.4b | R$3.7b | 12.5x | 17.1x | 1.7x |
| Sun, 07 Nov 2021 | R$70.1b | R$36.0b | R$3.6b | 13.4x | 19.4x | 1.9x |
| Tue, 05 Oct 2021 | R$69.1b | R$33.2b | R$3.3b | 17.3x | 21.2x | 2.1x |
| Thu, 02 Sep 2021 | R$74.7b | R$33.2b | R$3.3b | 18.5x | 23x | 2.3x |
| Sat, 31 Jul 2021 | R$77.7b | R$33.2b | R$3.3b | 18.8x | 23.9x | 2.3x |
Price to Earnings Ratio
34.2x
Current Industry PE
- Investors are optimistic on the Brazilian Information Technology industry, and appear confident in long term growth rates.
- The industry is trading at a PE ratio of 38.8x which is higher than its 3-year average PE of 25.5x.
- The 3-year average PS ratio of 1.6x is higher than the industry's current PS ratio of 1.3x.
Past Earnings Growth
- The earnings for companies in the Information Technology industry have declined 23% per year over the last three years.
- Meanwhile revenues have remained mostly flat.
- This means that although sales have remained flat, either the cost of doing business or the level of investment back into businesses has increased, which has decreased profits.
Industry Trends
Which industries have driven the changes within the Brazilian Tech sector?
| BR Market | 0.32% | |
| Tech | 1.97% | |
| Tech Hardware | 11.61% | |
| Communications | 2.64% | |
| Software | 1.67% | |
| Semiconductors | 0% | |
| Electronic Equipment and Components | -3.63% | |
| IT | -5.89% | |
Industry PE
- Investors are most optimistic about the Software industry even though it's trading below its 3-year average PE ratio of 54.8x.
- Analysts are expecting annual earnings growth of 23.4%, which is higher than its past year's earnings growth of 6.0% per year.
Forecasted Growth
- Analysts are most optimistic on the Tech Hardware industry, expecting annual earnings growth of 78% over the next 5 years.
- This is better than its past earnings decline of 19% per year.
- In contrast, the Electronic Equipment and Components industry is expected to see its earnings grow by 4.6% per year over the next few years.
Top Stock Gainers and Losers
Which companies have driven the market over the last 7 days?
| Company | Last Price | 7D | 1Y | Valuation | |
|---|---|---|---|---|---|
| TOTS3 TOTVS | R$28.71 | 2.5% +R$428.7m | -0.7% | PE32.4x | |
| MLAS3 Multilaser Industrial | R$2.17 | 13.6% +R$211.3m | -1.8% | PS0.5x | |
| INTB3 Intelbras - Indústria de Telecomunicação Eletrônica Brasileira | R$23.58 | 2.7% +R$199.8m | -11.6% | PE13.6x | |
| POSI3 Positivo Tecnologia | R$9.99 | 9.2% +R$117.7m | 48.4% | PE4.6x | |
| SQIA3 Sinqia | R$27.37 | 0.8% +R$17.8m | 34.5% | PE208.5x |