champc
While Brazilian capital market firms XP (NASDAQ:XP) and B3 S.A. (OTCPK:BOLSY) should be beneficiaries of lower rates and higher volume in riskier assets, XP’s revenues are expected to be more leveraged to a market rebound than B3’s, according to J.P. Morgan analyst Yuri Fernandes.
Fernandes, in turn, upgraded XP (XP) to Overweight from Neutral and downgraded B3 (OTCPK:BOLSY) to Neutral from Overweight.
In addition to lower Selic tailwinds, which have yet to materialize, he sees higher regulatory risks at B3 (OTCPK:BOLSY) over the near-term.
“Discussion on eventual ending of IOC are more relevant to B3 (~10% of EPS) than XP (~0% of EPS),” he wrote in a note.
XP climbed 4.3%, while BOLSY edged down 1% in late morning trading.