BMO Capital lowers JBS stock price target to $17 on weaker outlook

BMO Capital lowered its price target for JBS SA to $17.00 from $19.00, while maintaining an Outperform rating, citing a softer outlook for Pilgrim’s Pride and weaker U.S. beef packer margins that led to reduced 2025/2026 estimates. Despite the cut, BMO views JBS as undervalued given its diversified business model, which includes non-U.S. beef operations, and its discounted trading multiple. Separately, JBS NV reported Q2 2025 EPS of $0.50, significantly beating analyst estimates, although its revenue of $20.64 billion missed forecasts.

Analysis

BMO Capital lowered its price target for JBS SA to $17.00 from $19.00, while maintaining an Outperform rating, citing a softer outlook for Pilgrim's Pride (PPC) and weaker U.S. beef packer margins. This revision led to reduced 2025 and 2026 estimates for JBS, yet BMO views the stock as undervalued at $12.53, near its 52-week low of $12.37, suggesting the recent pullback is excessive. InvestingPro analysis also indicates potential undervaluation.

JBS NV reported Q2 2025 EPS of $0.50, significantly exceeding analyst projections of $0.39 by 28.17%, despite revenue missing forecasts at $20.64 billion versus $21.47 billion. This mixed performance underscores the importance of evaluating both profitability and top-line growth. BMO emphasizes JBS's diversified business model, including non-U.S. beef operations, as a key mitigating factor against segment-specific challenges.

The company's valuation at just over 6.5 times BMO’s 2026 EBITDA estimate further supports the undervaluation thesis, despite the revised outlook. Investor reactions have been mixed, reflecting the nuanced earnings report and the absence of immediate analyst rating changes post-release. The overall market impact is assessed as moderate, aligning with the neutral tone and mixed sentiment signals.

Key Decisions for Investors

• Investors should consider JBS's current trading price near its 52-week low and BMO's maintained Outperform rating, which suggests potential undervaluation despite the reduced price target.
• Monitor JBS's operational performance, specifically its non-U.S. beef segments, for their ability to offset challenges in U.S. beef packer margins and the softer outlook for Pilgrim's Pride.
• Future investment decisions should weigh JBS's continued EPS outperformance against revenue growth trends, as Q2 2025 results showed a strong earnings beat alongside a revenue miss.