Senior Credit Analyst - Emerging Markets, EM Spreads

Leandro Gubler

Senior Credit Analyst - Emerging Markets

EM Spreads

Credit

<ul>
<li>We move JBS to Neutral from Overweight as intermediate bonds rerated while leverage weakened, with company-defined net leverage at 3.10x, above management’s 2.0x–3.0x target.</li>
<li>2Q26 revenues rose 13.8% YoY to $23.9bn, but adjusted EBITDA fell 18.5%; sequential recovery and positive $130mn free cash flow partially offset weaker trailing credit metrics.</li>
<li>Liquidity remains a key support, with roughly $7.7bn available, 15.3-year average debt maturity and limited near-term refinancing pressure, giving JBS time for earnings normalization.</li>
</ul>


We move JBS to Neutral from Overweight as intermediate bonds rerated while leverage weakened, with company-defined net leverage at 3.10x, above management’s 2.0x–3.0x target.
2Q26 revenues rose 13.8% YoY to $23.9bn, but adjusted EBITDA fell 18.5%; sequential recovery and positive $130mn free cash flow partially offset weaker trailing credit metrics.
Liquidity remains a key support, with roughly $7.7bn available, 15.3-year average debt maturity and limited near-term refinancing pressure, giving JBS time for earnings normalization.


JBS 2Q26: Cash Generation Returns, Deleveraging Does Not

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Bottom-Up

<ul><li>JBS S.A. reported second-quarter 2026 results amid a complex global environment involving regional supply-demand imbalances, currency volatility, trade disruptions, and geopolitical challenges.</li><li>Adjusted net income excluding nonrecurring items was USD 218 million.</li><li>Adjusted EBITDA totaled USD 1.43 billion under IFRS with a 6% margin and USD 1.3 billion under U.S. GAAP with a 5.3% margin.</li></ul>

JBS S.A. reported second-quarter 2026 results amid a complex global environment involving regional supply-demand imbalances, currency volatility, trade disruptions, and geopolitical challenges.Adjusted net income excluding nonrecurring items was USD 218 million.Adjusted EBITDA totaled USD 1.43 billion under IFRS with a 6% margin and USD 1.3 billion under U.S. GAAP with a 5.3% margin.

JBS & Danantara Go Big On Southeast Asia — A $2.5 Billion Expansion Play!

<ul><li>JBS N.V., the world’s largest meatpacker, is making a fresh push to tighten its grip on the global protein market by proposing to acquire the roughly 18% of Pilgrim’s Pride Corporation (NASDAQ:PPC) that it does not already own.</li><li>JBS currently controls about 82% of the poultry producer, but the proposed transaction would eliminate Pilgrim’s remaining public ownership and ultimately remove its shares from Nasdaq.</li><li>Under the proposal, minority shareholders would receive approximately 2.1 JBS Class A shares for each Pilgrim’s share, turning owners of a largely poultry-focused company into investors in a much broader global protein platform.</li></ul>

JBS N.V., the world’s largest meatpacker, is making a fresh push to tighten its grip on the global protein market by proposing to acquire the roughly 18% of Pilgrim’s Pride Corporation (NASDAQ:PPC) that it does not already own.JBS currently controls about 82% of the poultry producer, but the proposed transaction would eliminate Pilgrim’s remaining public ownership and ultimately remove its shares from Nasdaq.Under the proposal, minority shareholders would receive approximately 2.1 JBS Class A shares for each Pilgrim’s share, turning owners of a largely poultry-focused company into investors in a much broader global protein platform.

JBS Wants The Final 18% Of Pilgrim’s Pride—Why The Timing Is Fascinating!

<ul><li>JBS N.V. is facing one of the strangest contradictions in the food business: Americans are paying record prices for beef, yet the world’s largest meat processor is closing plants and cutting capacity.</li><li>The company recently announced plans to shut its beef-processing plant in Souderton, Pennsylvania, and a value-added facility in Memphis, Tennessee, shifting production to other locations in its network.</li><li>On the surface, that sounds illogical.</li></ul>

JBS N.V. is facing one of the strangest contradictions in the food business: Americans are paying record prices for beef, yet the world’s largest meat processor is closing plants and cutting capacity.The company recently announced plans to shut its beef-processing plant in Souderton, Pennsylvania, and a value-added facility in Memphis, Tennessee, shifting production to other locations in its network.On the surface, that sounds illogical.

JBS Faces A Brutal Beef Paradox Investors Can’t Ignore!

<ul><li>JBS S.A. reported financial and operational results for the first quarter of 2026 marked by a complex external environment characterized by market volatility, seasonal factors, operational disruptions, and shifts in global trade flows.</li><li>Despite these headwinds, the company achieved record first-quarter net sales of approximately $22 billion, reflecting an 11% growth year-over-year.</li><li>Adjusted EBITDA totaled around $1.1 billion under IFRS (margin of 5.2%) and $916 million under U.S. GAAP (margin of 4.2%), with net income of $222 million and earnings per share of $0.21.</li></ul>

JBS S.A. reported financial and operational results for the first quarter of 2026 marked by a complex external environment characterized by market volatility, seasonal factors, operational disruptions, and shifts in global trade flows.Despite these headwinds, the company achieved record first-quarter net sales of approximately $22 billion, reflecting an 11% growth year-over-year.Adjusted EBITDA totaled around $1.1 billion under IFRS (margin of 5.2%) and $916 million under U.S. GAAP (margin of 4.2%), with net income of $222 million and earnings per share of $0.21.

JBS S.A.’s Hidden Margin Split: Brazil And Seara Shine While U.S. Beef Struggles!

United States

JBS N.V. operates as a meat processing company. The Company produces and delivers fresh and frozen beef, poultry, pork, fish, and lamb products to retailers and food-service customers. JBS serves customers worldwide.

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JBS (JBS US)

JBS 2Q26: Cash Generation Returns, Deleveraging Does Not

JBS cash generation recovered in 2Q26, but leverage remains elevated and valuation has tightened. We move to Neutral while retaining selective long...

Leandro Gubler

JBS & Danantara Go Big On Southeast Asia — A $2.5 Billion Expansion Play!

JBS S.A. reported second-quarter 2026 results amid a complex global environment involving regional supply-demand imbalances, currency volatility,...

Baptista Research

JBS Wants The Final 18% Of Pilgrim’s Pride—Why The Timing Is Fascinating!

JBS N.V., the world’s largest meatpacker, is making a fresh push to tighten its grip on the global protein market by proposing to acquire the...

Baptista Research

JBS Faces A Brutal Beef Paradox Investors Can’t Ignore!

JBS N.V. is facing one of the strangest contradictions in the food business: Americans are paying record prices for beef, yet the world’s largest...

Baptista Research

JBS S.A.’s Hidden Margin Split: Brazil And Seara Shine While U.S. Beef Struggles!

JBS S.A. reported financial and operational results for the first quarter of 2026 marked by a complex external environment characterized by market...

Baptista Research

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