LATIN AMERICA EQUITY RESEARCH: LATAM FIRST TO MARKET

Research evidence excerpt

LATIN AMERICA EQUITY RESEARCH: LATAM FIRST TO MARKET

Latin America Equity Research

LatAm First to Market 27 July 2026

Top Stories

| Weg (Marcelo Motta) (WEGE3 BZ, OW, PT R$56.00)

Setting Dec-27 PT at R$56.00 and Upgrading to OW; High Quality at Attractive Valuation

We are updating our estimates for WEG and upgrading the stock to Overweight from Neutral reflecting: i) positive

momentum as growth should accelerate in 2H26 and 2027, with top-line up 16% yoy in 2027 vs -3% yoy in 1H26; ii)

defensiveness against election volatility, as BRL appreciation should be limited in the short term, in our view; and iii) attractive

valuation at 17.1x EV/EBITDA 27e, a discount of ~15% to peers with similar growth level for 2027 and at a discount to its

historical valuation level. We are establishing our Dec-27 at R$56.00 representing an upside of 22% from current levels.

Moreover, we see WEG as a defensive stock given its exposure to international markets (60% of top-line); therefore, one of the

best vehicles to play the upcoming macro uncertainty (elections and rates higher for longer). In terms of estimates, we are

keeping revenues unchanged while increasing EBITDA and EPS by 1-3% due to a small improvement in margins. As a result,

our numbers now sit 1% above consensus for 2027e EPS. We now see WEG trading at 17.1x EV/EBITDA 27e and 25.3x P/E

27e, representing a discount of ~10% over its historical level (15Y looking at P/Es), and a premium of only 4-10% to peers vs

hist. levels (15Y) of 60-70%.

Cemex (Adrian E Huerta) (CX, OW, PT $15.00)

Raising Estimates on Strong 2Q; Now See FY26 EBITDA +18% y/y. PT Stays $15

Following strong 2Q results and 2026 guidance commentary, we are raising our 2026 estimates for Cemex and now see

FY26E EBITDA +18% y/y at $3,630 mn (+1% vs.