Brazilian stock alert


Afternoon Alert: Petroleo Brasileiro lifts 2.2%, leads market higher 16 January 2018 12:10 BRST


Petroleo Brasileiro SA (SA:PETR3) has lifted 2.2% to trade at R$18.87 vs. the Brazil Index 50 which strengthened 37.6 points (or 0.3%) to 13,395.6. Representing a weighting of about 6.4% of the index, the stock accounted for 50.8% of today's gain. The shares have outperformed 82% of the market in the past week. Trading volume was 68% of average so far today.

SECTION 1: The past week

Current indications of bullish signals that support the trend in the unusual trading

1.1 At a glance

Weekly: Petroleo Brasileiro shares post best week in thirteen months January 15, 2018 18:00 BRST

Petroleo Brasileiro SA (SA:PETR3), Brazil's largest Oil & Gas company by market cap, has increased 34.0 centavos (or 1.9%) in the past week to close at R$18.46. The shares had their best week in thirteen months since the week ended Jan 12, 2017. Compared with the Brazil Index 50 which rose 63.6 points (or 0.5%) in the week, this represented a relative price increase of 1.4%. The volume was 0.7 times average trading per week of 39.9 million shares. In the past week the market cap has risen R$2.5 billion.

1.2 5-day Recap

Petroleo Brasileiro outperformed the Brazil index 50 in 4 out of 5 days.

DayHeadlineClose price [BRL]Price change %Relative change %Comment
MondayPetroleo Brasileiro in 3rd consecutive rise, nears a 17-month high18.460.50.1
FridayPetroleo Brasileiro in 2nd consecutive rise, nears a 17-month high18.360.80.7
ThursdayPetroleo Brasileiro lifts 2.5% Rise
TuesdayPetroleo Brasileiro consolidates after 8 days of consecutive rises18.1200.3


DayHeadlineClose price [BRL]Price change %Relative change %Comment
WednesdayPetroleo Brasileiro falls 2.7% from 14-day high17.78-1.9-1.1Steepest Fall

SECTION 2: Technical indicators


The positive 0.58 MACD (Moving Average Convergence Divergence) indicator suggests a bullish signal (12-day minus 26-day Exponential Moving Averages). Both the 12-day and the 26-day EMA are rising - another bullish signal. In the past week, the stock's MACD has been positive every day, a reinforcing bullish signal.

In the Brazilian market, the stock's relative price strength percentile is rising at 85 for 6 months, 85 for 3 months and 86 for 1 month.

The price climbed 4.1% in the last week and soared 19.1% in the last month.

The present value of BRL1,000 invested one year ago is R$1,037 [vs R$1,262 for the Brazil Index 50], for a capital gain of R$37. The total return to shareholders for 1 year is 3.7%.

Fundamental measures by comparison with the sector average [in brackets] indicate:


Price/Sales of 0.5 [0.4]

Price to Book of 0.6 [0.5]



The 0.1% discount to 12-month high of R$18.89 against the 51.3% premium to 12-month low of R$12.47 suggests the climb might be peaking.

SECTION 3: Ranking

DescriptionValueRank In Market
MCap $US billion43.7In Top 3%
Price/MAP2001.24In Top Quartile
52-week Range (in R$)12.5-18.9
1-month Range (in R$)15.6-18.9

SECTION 4: Earnings

FY2016 Annual Report: Petroleo Brasileiro Revenue down 12.1%

Petroleo Brasileiro (SA:PETR3) reported total revenue for the year-ended 31 December 2016 of BRL283b ($US86.9b), down 12.1% from BRL322b ($US80.8b) in the previous year.

Major changes compared with previous year:

Favourable Changes:

- Debt to Equity down 100% from 7,455.5 to 1.5

- Current ratio up 18.4% from 1.5 to 1.8

- Working capital to total assets up from 6.4% to 8.0%

Unfavourable Changes:

- Total revenue down 12.1% from BRL321.6b ($US80.8b) to BRL282.6b ($US86.9b)

- EBIT Margin of -3.8%

- Total revenue to total assets down from 1,395.3 to 0.4

- Retained earnings to total assets down from 40,175.1% to 9.7%

- Total current assets to Total Assets down from 18.8% to 18.1%

- Total Liabilities to Operating Cash Flow of 6.2 compares unfavourably with the Joseph Piotroski benchmark of less than 4. However, it has improved by 3% from the previous year's ratio of 6.3.


- Cost of Goods Sold to Sales down from 69.3% to 68.2%

- Total liabilities to Total assets steady at 0.7

- Fixed Assets to Total Assets up from 70% to 71%

- Current Inventory to Total Assets up from 3.2% to 3.4%

Petroleo Brasileiro SA (SA:PETR3; SAO:PETR3; BZ:PETR3)


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