Petróleo Brasileiro S.A. - Petrobras (PBR): investment thesis checklist
What a value investor writing down why they own Petróleo Brasileiro S.A. - Petrobras would be relying on, read from its filings: the figures that have carried the business, the lines a reader might set on them, and the published tests it meets today. A list to write against, not a view on the company.
1. The figures the case would rest on
- Return on invested capital: 15.8% in FY2024; between 7.2% and 34.0% over 7 filed years, median 15.8%. Does the thesis need it to stay inside that range?
- Return on equity: 12.7% in FY2024; between -12.9% and 52.7% over 10 filed years, median 11.4%. Does the thesis need it to stay inside that range?
- Gross margin: 50.3% in FY2024; between 30.6% and 52.7% over 10 filed years, median 43.0%. Does the thesis need it to stay inside that range?
- Operating margin: 29.4% in FY2024; between 5.3% and 45.9% over 10 filed years, median 23.4%. Does the thesis need it to stay inside that range?
- Revenue growth, 5-year CAGR: 3.6% in FY2024; between -11.8% and 9.8% over 10 filed years, median -7.0%. Does the thesis need it to stay inside that range?
2. What must stay true: guardrails a reader might set
Each line is drafted from Petróleo Brasileiro S.A. - Petrobras's own current figure, never from a level we think a business should clear, and replayed over its filed years. They are a reader's to keep, edit or drop.
Debt to Equity stays at or below 1.27x
Today 1.02x. Replayed over 7 filed years, it held in every one.
Current Ratio stays at or above 0.55x
Today 0.69x. Replayed over 9 filed years, it held in every one.
Return on Invested Capital stays at or above 12.6%
Today 15.79%. This indicator depends on inputs (market price, multi-statement composites) whose history is not deep enough to re-derive it with the same formula as the live value, so no honest retro-test exists for it.
3. What would break it
- A filed year in which debt to equity rose above 1.27x.
- A filed year in which current ratio fell below 0.55x.
- A filed year in which return on invested capital fell below 12.6%.
4. The published tests it meets today
Of 30 tests value investors published: 3 met, 23 not met, 4 we could not complete. Counts, never a score.
Meets: Earnings yield and ROIC (Joel Greenblatt); ROIC at or above WACC; Cash-flow yield and ROIC.
What this cannot tell you
What the numbers say today, not the day one stops being true. The reasons are not written down.
An account adds
One email the night a number you wrote down breaks. Silence otherwise.
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How this is computedA computation on accounts filed with the SEC, not a recommendation and not advice. Past filings do not indicate future results. Risk disclaimer.