Petrobras: Value Destruction Ahead (Archive)

This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.

Elevator Pitch

• Petrobras is headed in a perilous direction for minority shareholders, fraught with risks of value destruction.
• Petrobras' days of high dividend payout are over.
• Lower downstream pricing will reduce margins.
• Return-dilutive capex will erode free cash flow.
• Petrobras last year was an opportunity for quick shareholder value realization. The company now is a trap as it has transformed into a long-duration equity undertaking return-dilutive capex, acting in the best interests of the government.

Read the full article here.