J.P. Morgan LatAm FTM 10 Jun 26 Traxion; Brazil Beef; Brazilian Homebuilders; Latam Cement Data Points; Vale and More

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J.P. Morgan LatAm FTM 10 Jun 26 Traxion; Brazil Beef; Brazilian Homebuilders; Latam Cement Data Points; Vale and More

Latin America Equity Research

LatAm First to Market 10 June 2026

Top Stories

| Traxion (Guilherme Mendes) (TRAXIONA MM, N, PT Ps14.00)

Downgrading to Neutral on Lack of Momentum Despite Attractive Valuation

We are revising our estimates for Traxión and downgrading the stock to Neutral from Overweight, reflecting the absence of

near-term catalysts and weak earnings momentum. We acknowledge that Traxión is currently trading at a 35% discount to

historical levels, at 3.1x EV/EBITDA and 8.1x P/E on a 12-month forward basis, and implies a 42% upside to our revised

December 2026 Price Target. That said, the stock remains highly exposed to domestic economic activity and USMCA

negotiations, both of which continue to weigh on the investment thesis as the trade agreement revision faces further delays.

This postponement adds another layer of uncertainty around earnings momentum, pointing to limited near-term triggers for a

valuation re-rating. On the positive side, we view favorably the ongoing reorganization within the Mobility of Cargo segment, as

well as management's focus on free cash flow generation, which is driving a free cash flow yield of over 20% this year —

despite growth tracking below historical levels . We are revising our operating estimates down by low-to-mid single digits for the

coming years, while reducing our perpetuity growth rate by 0.5 p.p. and increasing our cost of equity by 0.5 p.p., leading to a

December 2026 Price Target of Mx$14.0, down from Mx$21.5 previously . Within our Mexico coverage, we favor the airports,

particularly GAP (OW) - more details here and on Figure 4.

Brazil Beef (Lucas Ferreira)