Earnings call transcript: Grupo Vamos misses Q4 2025 forecasts By Investing.com

Grupo Vamos missed Q4 2025 consensus with EPS $0.0594 vs $0.0839 (‑29.2%) and revenue $1.48bn vs $1.53bn (‑3.27%), yet the stock ticked up 0.53% to $3.77. Operationally the company showed strength: consolidated net revenue rose ~22% to BRL 5.8bn, EBITDA up 7% to BRL 3.6bn, Q4 net income BRL 78m (up 54% q/q), utilization at 87% and lease EBITDA margin at 90%. Management reiterated a target of 90% fleet utilization by end-2026, highlighted growth in rental and used-vehicle sales and disclosed liquidity (BRL 4.7bn) and deleveraging progress, but high interest rates and analyst forecasts of a ~24% revenue decline this year present material near-term headwinds.

Analysis

The company’s strategic shift toward leasing formerly returned assets and maturing a direct used-vehicle distribution channel functionally turns residual-value risk into a recurring-service and marketing funnel. That reduces incremental capital intensity per contract and creates a liquidity lever: faster turn of inventory amplifies free cash flow sensitivity to used-vehicle price moves rather than new-vehicle order cycles.

That asset-light tilt also changes competitive dynamics across the supply chain. OEMs and new-vehicle financiers now face a demand diversion into secondary-market leasing products, compressing new-vehicle order visibility while increasing the bargaining power of large lessors for supply and customization (biomethane adoption is a distribution wedge for specialized trucks). Dealers and captive finance arms that rely on new-vehicle margin and securitization will see slower receivable growth and higher credit mix churn.

Key risks cluster around residual values and credit normalization: if used-vehicle prices reprice lower or delinquency rebounds, the business suffers both through lower sale proceeds and faster-than-expected return flows. Near-term catalysts to monitor are cadence and margin of used-vehicle disposals, cadence of contract extensions versus early terminations, and any shifts in local credit availability tied to election-year macro risk; those datapoints will re-rate the optionality embedded in the lease book within 1–6 months.

Key Decisions for Investors

• Long VAMO3 equity (or local ADR if available) — horizon 6–12 months. Rationale: optionality from an increasingly asset-light leasing mix and a maturing direct sales channel should re-rate multiples if used-vehicle realization trends hold. Risk management: costless collar or buy 9–12 month protective puts to cap downside from a >15% sudden PV reversion; target reward 30–50% if market acknowledges structural margin improvement.
• Pair trade: Long VAMO3 / Short CNHI (CNH Industrial) — horizon 6–12 months. Rationale: arbitrage exposure to leasing-led share shift away from new-equipment OEMs; VAMO3 captures secondary-market spreads while CNHI more levered to new-vehicle unit cycles. Position sizing: 0.6–0.8x notional on the short side to reflect different betas; stop-loss if VAMO3 falls >20% on systemic macro news.
• Event hedge: Buy 3–6 month put protection on VAMO3 ahead of Brazil macro-election windows or major used-vehicle inventory updates. Rationale: preserves upside optionality while protecting against sudden deleveraging or credit tightening that would spike return rates and depress residuals. Size: 5–10% of equity notional; if put premia are expensive, use staggered strikes to balance cost vs protection.