Cielo Profit Beats Analysts’ Estimates on Market Share Gain
February 10, 2012, 3:19 AM ESTBy Francisco Marcelino
(Updates share price in fifth paragraph.)
Feb. 9 (Bloomberg) -- Cielo SA, Brazil’s biggest card- payment processor by market value, posted a 14 percent increase in fourth-quarter profit that beat analysts’ estimates as the company boosted market share.
Net income rose to 504.5 million reais ($293 million) from 443.3 million reais a year earlier, the Barueri-based company said in a regulatory filing yesterday after the market closed. That beat the average estimate of 487 million reais in a Bloomberg survey of 14 analysts.
Cielo, led by Chief Executive Officer Romulo de Mello Dias, said it increased market share to 58 percent at the end of December, from 57 percent in September and 56 percent in December 2010.
“Cielo’s fourth-quarter numbers once again beat our forecasts and clearly indicate that there is upside to our current estimates,” Regina Longo Sanchez, Alexandre Spada and Thiago Bovolenta Batista, analysts at Itau Unibanco Holding SA’s Itau BBA unit, wrote in a report today. The analysts have an “outperform” recommendation for Cielo with a target price of 59 reais per share at the end of 2012.
Cielo rose less than 0.1 percent to 56 reais in Sao Paulo trading today, while the benchmark Bovespa index dropped 0.5 percent.
Total credit-card, debit-card and consumer transactions in the fourth quarter climbed 26 percent to 95.1 billion from a year earlier, the company said.
--Editors: Steve Dickson, William Ahearn
To contact the reporter on this story: Francisco Marcelino in Sao Paulo at mdeoliveira@bloomberg.net
To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net
