Second-quarter net revenue hit R$1.55 billion, up 10.1% year over year, while contracted capex surged 59.6% and the stock trades 36% below its 52-week high.
3 Key Points
—Vamos (VAMO3), Brazil's largest truck and machinery rental group and a sister company of car renter Movida inside the Simpar empire, pre-released second-quarter operating numbers on July 17: net revenue of R$1.55 billion ($304M), up 10.1%, with the rental core at R$1.08 billion ($212M) and asset sales up 12.6% — the shares spiked as much as 6% on the release.
—The forward-looking number is the loud one: contracted capex — new rental agreements signed — jumped 59.6% year over year to R$1.55 billion ($304M), with the 'Sempre Novo' fleet-renewal program growing 51.6%; Brazilian companies are signing up for trucks they will only receive quarters from now.
—The balance sheet explains the discounted price: R$16.5 billion ($3.2B) of net debt against R$2.6 billion ($510M) of equity makes Vamos the most leveraged name in this earnings series relative to its size — at R$3.17, 36% below its 52-week high, the stock trades at 10.9x earnings with a consensus target of R$4.89, a 54% gap that is pure Selic bet.
