Investors exhibit renewed enthusiasm for Brazil’s healthcare sector, with positioning levels jumping sharply, according to a recent poll of 23 market participants conducted from April 22 to 29.
Key Survey Findings
The poll highlights a dramatic rebound in investor positioning, rising from 39% in the fourth quarter of 2024 to 77%. Participants favor selective bets on standout companies amid high barriers to entry in outpatient services and strong cash generation.
Rede D’Or Leads Preferences
Rede D’Or emerges as the top pick, driven by expectations of market share gains through 2026 and sustained revenue growth into 2027. Investors anticipate robust performance from this hospital operator.
Amil Gains Favor, Pressures Rivals
Amil commands strong investor support, exerting negative pressure on Hapvida and capping upside for SulAmérica. Small- and mid-cap players with solid brand moats also attract attention for capturing broader sector exposure.
M&A Expectations Rise
A solid 73% of respondents predict major acquisitions in the private sector by 2025, with many extending timelines into 2026. This optimism underscores a favorable view on liquidity and leverage opportunities.
Interest Rate Outlook
While rates are set to climb across periods, only 26% foresee the Selic exceeding 100 basis points, tempering broader expectations.
Hapvida Faces Headwinds
Sentiment toward Hapvida remains firmly negative, despite positive exchange rate impacts. Fully 86% believe operational improvements are already priced in. However, 77% expect growth in its non-hospital segments, like dental services, to bolster the balance sheet and enhance leverage—potentially aiding valuation in a rallying market.
Overall, participants favor firms like Rede D’Or and Odontoprev for superior revenue trajectories, large-scale efficiencies, and market share grabs, reflecting heightened sector confidence.
