Investing.com – Stephens lowered its price target on JBS SA () to $17 from $18 while maintaining an Overweight rating on the stock.
JBS reported second-quarter 2026 adjusted EBITDA of $1,429 million, compared with Stephens’ estimate of $1,424 million and consensus estimate of $1,375 million. The company reported adjusted earnings per share of $0.20, missing Stephens’ estimate of $0.37 and consensus estimate of $0.31. Despite the EPS miss, the company trades at an EV/EBITDA multiple of 6.81, and InvestingPro analysis indicates JBS is currently undervalued relative to its Fair Value.
The earnings per share miss was largely due to higher-than-expected interest expense. The EBITDA beat reflected better-than-anticipated performance in U.S. Beef, partially offset by softer results in U.S. Pork.
U.S. Beef results benefited from operational restructuring and self-help initiatives, with management indicating much of its targeted 300 basis points of improvement remains ahead. U.S. Pork was softer as demand weakened, particularly across prepared foods, while PPC remains pressured by elevated broiler supply. The company’s gross profit margin of 11.8% reflects ongoing operational challenges, though InvestingPro subscribers have access to 10 additional exclusive tips and comprehensive Pro Research Reports covering JBS and 1,400+ other US equities.
The Mexican border reopening and expectations for more normalized cattle flows by second-quarter 2027 provide a pathway to improved U.S. Beef profitability. Australia, JBS Brazil and Seara remain supportive.
In other recent news, JBS reported its second-quarter 2026 financial results, highlighting a significant achievement in net sales. The company posted record net sales of $24 billion, demonstrating its extensive reach across global protein markets. Despite this, JBS fell short of earnings expectations, reporting adjusted earnings of $0.20 per share, below the forecasted $0.34. The company also recorded a net loss of $102 million for the quarter. A positive development was seen in JBS’s free cash flow, which turned positive at $130 million, contrasting with a cash outflow from the previous year. Notably, the Brazilian beef segment delivered record quarterly EBITDA, while U.S. pork and Brazil poultry operations remained profitable. Analysts have observed these results amid ongoing challenges such as volatile supply and demand conditions and geopolitical uncertainties. Management emphasized the importance of strategic initiatives, including the reopening of the Mexican border and expansion in Southeast Asia.
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