Banco Santander Brasil (NYSE:BSBR) Posts Quarterly Earnings Results, Misses Expectations By $0.10 EPS

Banco Santander Brasil (NYSE:BSBR) issued its quarterly earnings results on Wednesday. The bank reported $0.07 earnings per share for the quarter, missing the consensus estimate of $0.17 by ($0.10), FiscalAI reports. The company had revenue of $3.48 billion for the quarter, compared to analysts’ expectations of $3.98 billion. Banco Santander Brasil had a return on equity of 11.06% and a net margin of 7.49%.

Here are the key takeaways from Banco Santander Brasil’s conference call:

• Third-quarter recurring net income was R$2.9 billion and ROE was 11.9%, both below management’s longer-term ambitions, as high interest rates, household debt and portfolio rebalancing weighed on profitability.
• Loan growth was strongest in mortgages, SMEs and consumer finance, while transactional deposits rose 10% year over year. However, client NII declined as lower funding income, portfolio sales, selective origination and a shift toward lower-spread, lower-risk clients pressured margins.
• Asset quality remained under pressure, including approximately R$500 million in one-off wholesale provisions and continued deterioration in agribusiness, low-income borrowers and some middle-income unsecured loans. Management warned that persistently high rates could create additional pressure for SMEs and agribusiness.
• Expense growth remained below inflation, improving the efficiency ratio to 38.8%, supported by product simplification, digitization and greater use of digital sales channels.
• Management expects better NII conditions in 2027 and is targeting sustainable profitability recovery through higher customer primacy, secured and transaction-linked lending, and more capital allocation to high-net-worth clients and large corporates. The bank also continues to scale Santander Rewards, which has reached about 700,000 clients and is driving higher spending and investment activity.

Banco Santander Brasil Stock Performance

Shares of Banco Santander Brasil stock traded down $0.12 during trading hours on Friday, hitting $4.45. 447,620 shares of the company’s stock traded hands, compared to its average volume of 2,239,739. The company has a current ratio of 1.56, a quick ratio of 1.56 and a debt-to-equity ratio of 3.34. The company has a fifty day simple moving average of $5.67 and a 200-day simple moving average of $5.83. Banco Santander Brasil has a 12-month low of $4.41 and a 12-month high of $7.32.

Banco Santander Brasil Cuts Dividend

The firm also recently declared a quarterly dividend, which will be paid on Thursday, November 19th. Investors of record on Thursday, October 22nd will be given a dividend of $0.0804 per share. The ex-dividend date of this dividend is Thursday, October 22nd. This is a negative change from Banco Santander Brasil’s previous quarterly dividend of $0.1045. This represents a $0.32 dividend on an annualized basis and a dividend yield of 7.2%.

Insider Transactions at Banco Santander Brasil

In related news, insider Gustavo De Sousa Santos sold 29,200 shares of the business’s stock in a transaction dated Tuesday, August 4th. The stock was sold at an average price of $5.70, for a total transaction of $166,440.00. Following the completion of the transaction, the insider directly owned 53,023 shares in the company, valued at $302,231.10. The trade was a 35.51% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, VP Edmilson Saes sold 50,000 shares of the company’s stock in a transaction that occurred on Tuesday, September 22nd. The stock was sold at an average price of $5.79, for a total transaction of $289,500.00. Following the completion of the transaction, the vice president owned 300,203 shares in the company, valued at approximately $1,738,175.37. This trade represents a 14.28% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last quarter, insiders have sold 233,438 shares of company stock valued at $1,338,299. Corporate insiders own 0.06% of the company’s stock.

Wall Street Analysts Forecast Growth

BSBR has been the topic of a number of recent analyst reports. Wall Street Zen lowered Banco Santander Brasil from a “buy” rating to a “hold” rating in a research note on Sunday, July 12th. UBS Group cut Banco Santander Brasil from a “buy” rating to a “neutral” rating in a report on Monday, August 24th. JPMorgan Chase & Co. downgraded shares of Banco Santander Brasil from an “overweight” rating to a “neutral” rating and reduced their price target for the stock from $6.50 to $6.00 in a research report on Thursday, July 30th. Zacks Research raised shares of Banco Santander Brasil from a “strong sell” rating to a “hold” rating in a report on Tuesday, October 20th. Finally, HSBC cut shares of Banco Santander Brasil from a “buy” rating to a “hold” rating and lowered their price objective for the company from $7.20 to $6.20 in a research report on Tuesday, September 15th. Five equities research analysts have rated the stock with a Hold rating. According to data from MarketBeat.com, the stock currently has an average rating of “Hold” and a consensus target price of $6.10.

About Banco Santander Brasil

Banco Santander (Brasil) SA is a Brazilian financial institution and a subsidiary of Spain-based Banco Santander. It provides banking and financial services to individuals, small and midsize businesses, corporate clients and institutional customers throughout Brazil.

The company’s offerings include checking and savings accounts, consumer and commercial loans, credit and debit cards, mortgages, payroll lending, insurance, investment products, foreign-exchange services, cash management and payment solutions.