First Read Cyrla Operational 2Q26: High-income performance driving slightly softer SoS figures

研报英文原文证据摘录

First Read Cyrla Operational 2Q26: High-income performance driving slightly softer SoS figures

Forecast returns

Forecast price appreciation 60.4%

Forecast dividend yield 4.6%

Forecast stock return 65.0%

Market return assumption 18.5%

Forecast excess return 46.5%

Company Description

Focused on high-income and luxury real estate development, Cyrela is present

throughout Brazil, with landbank of R$33bn. Founded in São Paulo in 1962, the company

has traded on Bovespa's Novo Mercado (the highest level of corporate governance in

Brazil) since 2005. In addition to its main business, the company has three brands: Living,

which develops middle-income residential buildings; Vivaz, which operates within the

Casa Verde e Amarela program (low-income government housing financing); and Cyrela

Urbanismo, which focuses on allotment development.

Valuation Method and Risk Statement

We value Cyrela based on a P/E target methodology backed by a DCF.

Main risks:

- Cost pressure: Increased raw material prices can raise overall costs for the company

and reduce its profit, leading to margin declines for the developments where that

occurs.

- Affordability issues: The degree of difficulty among buyers to maintain unit acquisitions

due to unemployment, changes in competitive real estate prices regionally, higher

financing interest or even personal problems may cause projects to lose a significant

amount of sales by the key expected date of delivery, causing the projects to generate a

smaller amount of cash than expected.

- Decreased funding resources: The lack of available resources to obtain funding due to

savings account outflow can impair the capacity or availability of potential homebuyers

to finance acquisitions, since most sales occur with funding support from SFH (financial