Ambev Shares Rise 2.5% After Report of Proposed Change to Remuneration
By Jeffrey T. Lewis
SÃO PAULO--Ambev's shares rose 2.5% after a report that the government is proposing a less-negative-than-expected change to rules regarding payments of interest on capital to shareholders.
The shares reached 13.63 reais, the equivalent of $2.77, and were down 8.4% from the end of last year through Wednesday's close. Brazil's benchmark Ibovespa stocks index was up 0.4% in mid-afternoon trading.
The proposed rule limiting how much companies can pay to shareholders as interest on capital, as reported by Brazil's Valor Economico news organization, would be positive for Ambev, say XP Investimentos analysts Leonardo Alencar and Pedro Fonseca in a research note.
Investors were expecting a more negative approach, though the government has yet to release a definitive proposal, XP says. Payments of interest on capital are a way for companies to remunerate shareholders while also reducing their tax burden.
Write to Jeffrey T. Lewis at jeffrey.lewis@wsj.com
(END) Dow Jones Newswires
November 30, 2023 12:53 ET (17:53 GMT)
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