LATAM FIRST TO MARKET

Research evidence excerpt

LATAM FIRST TO MARKET

Latin America Equity Research

LatAm First to Market 31 July 2026

Top Stories

| | Mexico Food (Lucas Ferreira/Froylan Mendez)

Rewarding Momentum. Upgrading Bimbo to N, Downgrading Gruma to UW. Reiterating Sigma OW

We are reshuffling preferences post earnings: we reiterate our Overweight on Sigma, upgrade Bimbo from Underweight to

Neutral, and downgrade Gruma from Neutral to Underweight, reflecting how the market is currently rewarding earnings

momentum and near-term delivery amid elevated volatility. Sigma remains our preferred way to play Mexican Food as it

combines the cleanest earnings trajectory (Europe recovery milestones and 2H seasonality; U.S. sequential improvement with

clearer 2H signposts) with the most defensible valuation ~14x fwd P/E at the middle of the food pack but with by above-average

~17% 2Y EPS CAGR, making it the best-balanced story on valuation + growth + momentum. We upgrade Bimbo to Neutral as

momentum is improving (notably better margin/FCF confidence via the higher FY26 margin guide and lower CapEx), but at

~20x fwd P/E the stock screens at a premium to peers, keeping us from OW even if it may post the strongest EPS growth near

term (helped by easier comps). Gruma moves the other way: despite being the cheapest (~11x P/E), we see deteriorating

momentum after the U.S.-driven guidance reset (top line cut to a fractional decline; margin contraction widened), leaving it with

the weakest earnings slope in the group and supporting the downgrade. We are establishing Dec 2027 price targets for all

companies with SigmaFoods offering the highest upside potential at 50%, while Bimbo and Gruma both offer 10% upside

potential.

Brazilian Retail (Joseph Giordano/Nicolas Larrain)