Barry Schwartz SABESP SBS-N PAST TOP PICK Jul 03, 2013

SBS is a Sao Paulo based provider of basic environmental and sanitation services to over 350 municipalities in Brazil.  It trades at 12x earnings, 1.6x book and supports a ROE of 27%.  Recently reported earnings showed a 17% in earnings.  We recommend setting a stop-loss at $11.25, looking to achieve $21.00 -- upside potential of 35%.  Yield 1.8%

We reiterate SBS, Brazil's largest provider of environmental and sanitation services as a TOP PICK.  We like that cash reserves continue to grow, it trades at 6x earnings, under 2x book and supports a 27% ROE.  We recommend trailing up the stop (from $11.25) to $14.00, looking to achieve $20.00 -- upside potential of 23%.  Yield 1.6%

We reiterate SBS, Brazil’s water treatment and sewage management utility as a TOP PICK.  Aside from offering global diversification, it operates in a conservative space.  It trades at 15x earnings, 1.6x book and supports a ROE of 27%.  We continue to recommend a stop at $14, looking to achieve $21 — upside potential over 25%.  Yield 3.1%

We reiterate this Brazil based water treatment utility as a TOP PICK.  It has avoided much of the tariff related mayhem thus far and provides some geographic diversification.  It trades at 15x earnings, 1.7x book and supports a 28% ROE.  We recommend scaling up the stop (from $14) to $16, looking to achieve $23 -- upside potential over 30%.  

Our PAST TOP PICK with SBS is progressing well.  To remain disciplined, we recommend trailing up the stop (from $16.00) to $17.50 at this time.  

We reiterate SBS, Brazil's sanitation utility, as a TOP PICK.  The company plans to double its infrastructure base by 2029 and analysts foresee 45% growth in EPS next year.  It trades at 16x earnings, 2x book and supports a robust 29% ROE.  We continue to recommend a stop at $17.50, looking to achieve $24.00 -- upside potential of 17%.  Yield 2.1%