By Brazil Stock Guide – Cosan SA (CSAN3) reported a second-quarter net loss of R$1 billion ($197 million), a 316.7% deterioration from the R$227 million shortfall a year earlier, according to a report by Estadão’s E-Investidor. The company, a diversified Brazilian holding with stakes in Raízen (RAIZ4), Rumo (RAIL3), Compass, Moove and Radar, has seen its shares fall 30% so far in 2025, making it the second-worst performer on the Ibovespa.
BTG Pactual (BPAC11) said in a note that the weak numbers mask underlying efforts to strengthen the balance sheet. “Cosan has made progress in its liability management initiatives. However, as the year progressed, we did not see new signs that could trigger the much-needed deleveraging of the balance sheet. That’s probably why the share price has fallen about 30% so far,” the bank wrote.
Cosan has no major debt maturities until 2028 and closed the quarter with R$17.5 billion in net debt. Its interest coverage ratio remained stable at 1.2x. Still, the high-rate environment in Brazil keeps pressure on the company’s financials. Analysts stress that any new asset sales or equity moves will be decisive to unlock value.
Subsidiary results mixed
Among Cosan’s portfolio companies, Moove posted an adjusted Ebitda of R$505 million, far above Itaú BBA’s forecast of R$103 million. The gain, however, came mainly from partial insurance payouts related to a February fire at its Rio de Janeiro plant. Without that, Ebitda dropped to R$61 million, down 74% from the previous quarter. “This shows how Moove’s operations remain compromised after the factory fire,” XP Investimentos said.
Raízen remained Cosan’s main drag, with Ebitda down 23% year-on-year on weaker cane sales, coupled with rising debt. Analysts at Empiricus see progress under its new management. “It is important to recognize the efforts of Raízen’s new management in the operational turnaround,” said analyst Larissa Quaresma, noting cuts in administrative expenses and reduced capex.
Rumo and Compass, meanwhile, delivered what banks considered solid numbers.
Analysts keep buy ratings despite risks
Despite the mounting losses and leverage, major banks see upside in Cosan’s shares. XP set a 12-month price target of R$17, implying a 215% gain from Tuesday’s closing price of R$5.40. Itaú BBA sees R$20 (270% upside), while BTG Pactual has the most bullish target at R$23, or a potential 325% rally.
“Owning Cosan shares today requires a certain level of confidence that management can find the best options to sell assets, divest stakes or improve the performance of its weaker subsidiaries to make the math work in its favor,” BTG Pactual wrote, adding that if its projections prove right, CSAN3 could combine deleveraging with a narrowing of the holding discount.