Lavoro (LVRO) versus Its Competitors Critical Review

Lavoro (NASDAQ:LVRO) is one of 28 publicly-traded companies in the “Miscellaneous retail” industry, but how does it compare to its peers? We will compare Lavoro to related companies based on the strength of its valuation, earnings, risk, dividends, analyst recommendations, institutional ownership and profitability.

Analyst Recommendations

This is a breakdown of recent ratings for Lavoro and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lavoro	0	1	2	0	2.67
Lavoro Competitors	120	539	459	6	2.31

Lavoro currently has a consensus price target of $10.83, suggesting a potential upside of 62.91%. As a group, “Miscellaneous retail” companies have a potential downside of 1.43%. Given Lavoro’s stronger consensus rating and higher probable upside, equities analysts plainly believe Lavoro is more favorable than its peers.

Insider and Institutional Ownership

2.5% of Lavoro shares are held by institutional investors. Comparatively, 39.2% of shares of all “Miscellaneous retail” companies are held by institutional investors. 20.2% of shares of all “Miscellaneous retail” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Lavoro and its peers revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Lavoro	$1.79 billion	-$50.50 million	-6.79
Lavoro Competitors	$1.94 billion	$32.37 million	9.69

Lavoro’s peers have higher revenue and earnings than Lavoro. Lavoro is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Volatility & Risk

Lavoro has a beta of 0.14, suggesting that its stock price is 86% less volatile than the S&P 500. Comparatively, Lavoro’s peers have a beta of 1.14, suggesting that their average stock price is 14% more volatile than the S&P 500.

Profitability

This table compares Lavoro and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lavoro	-5.99%	-6.44%	-1.45%
Lavoro Competitors	-22.15%	-42.09%	-4.34%

Summary

Lavoro peers beat Lavoro on 7 of the 13 factors compared.

About Lavoro

Lavoro Limited operates as an agricultural inputs retailer. The company operates through three segments: Brazil Cluster, LATAM Cluster, and Crop Care Cluster. It distributes agricultural inputs, such as crop protection, seeds, fertilizers, foliar fertilizers, biologicals, adjuvants, organominerals, and others for the agricultural industry. The company also produces specialty fertilizers, crop protection products, and biological crop inputs. It operates in Brazil, Colombia, and Uruguay. The company sells its products through its physical stores and digital channel. Lavoro Limited was founded in 2017 and is headquartered in Sao Paulo, Brazil.