Direcional 1Q26 Results: Solid With Net Income +27% YoY and 2% Above Consensus on Top-line and Gross Mg.

Research evidence excerpt

Direcional 1Q26 Results: Solid With Net Income +27% YoY and 2% Above Consensus on Top-line and Gross Mg.

J P M O R G A N Latin America Equity Research

11 May 2026

Direcional Neutral

DIRR3.SA, DIRR3 BZ

1Q26 Results: Solid With Net Income +27% YoY and Price (11 May 26):R$12.85

2% Above Consensus on Top-line and Gross Mg.

Latin American Cement &

Direcional reported its 1Q26 results (link here) on May 11th after market close. In Construction / Real Estate

our view, it was a solid quarter as net income came in at R$200mn, +7% above Marcelo Motta AC

JPMe and 2% above consensus given strong top-line (+30% yoy) and another (55-11) 4950-6712

record gross margin, offsetting a higher-than-expected G&A and a larger minority marcelo.g.motta@jpmorgan.com

Banco J.P. Morgan S.A.

payout. DIRR is trading at 7.3x P/E 2026e vs. CURY at 7.5x, MRVE at 5.5x and

Jonathan S. Koutras

TEND at 5.9x.

(55-11) 4950-3549

• Our take. We expect a small positive reaction as recurring net income was at jonathan.s.koutras@jpmchase.comBanco J.P. Morgan S.A.

R$200mn, being 2-7% better-than-expected due to strong top-line and strong

Adrian E Huerta

margins at 42.9% (+1.3pp yoy and +0.4pp vs JPM) indicating Direcional’s

(52-81) 8152-8720

confidence in its construction process and project budgeting amid looming adrian.huerta@jpmorgan.com

inflation pressures. J.P. Morgan Casa de Bolsa, S.A. de C.V., J.P.

Morgan Grupo Financiero

• Main positives. i) Top-line was at R$1.1bn - beating consensus by 1% and Garrett Greenblatt

JPMe by 10%, growing 30% yoy; ii) Adj. gross margin was at a record high, (1-212) 622-0424

reaching 42.9%, +0.4pp vs. JPMe and +1.3pp yoy; iii) Other operational results garrett.greenblatt@jpmorgan.com

were at -R$13mn vs JPMe at -R$32mn, helped by a +R$13mn net gain on J.P. Morgan Securities LLC