Natura & Co Holding S.A.

Credit research report affirming a BB/Stable issuer rating, expecting consolidated revenue to grow around 8–10% per year in the next three years, EBITDA margins to rise toward 13–15%, and adjusted debt/EBITDA to fall toward 1.2x by 2027. It highlights execution risk around Wave 2 integration, macro headwinds in Brazil and Argentina, and the need for free operating cash flow to turn strongly positive in 2026–2027 to support deleveraging and shareholder returns.

Cross‑sector 4Q25 earnings monitor where Safra’s strategy team reviews results across the Ibovespa and flags Natura’s performance as mixed, with weaker revenue trends and margin pressures but overall numbers roughly in line with their expectations once distortions are excluded. For NATU3 they explicitly maintain a neutral recommendation for both 4Q25 and their 1Q26 outlook, citing limited visibility on a sustainable operational recovery amid a tough consumer environment and ongoing restructuring.

3Q25 results report noting that consolidated net revenue fell 13% year‑on‑year, with particularly weak Avon sales and softer Natura performance, leading to de‑leveraging of operating margins and an adjusted EBITDA margin contraction of 350 bps to 11.1%. BTG emphasizes rising net leverage to 2.53x, currency and derivative losses that drove a net loss, and maintains a neutral rating and R$18 target price while stressing that persistent demand weakness and Avon LatAm challenges must be resolved before a more positive stance is warranted.

Independent stock research report arguing that the “new” LatAm‑focused Natura is a high‑margin, cash‑generative consumer‑staples leader, showing H1 2025 recurring EBITDA margins around 14.85% and trading at roughly 4.9x EV/TTM EBITDA, which the author views as a distressed valuation inconsistent with fundamentals. It presents detailed 5‑year bull, base and bear scenarios and a probability‑weighted 2030 price target of R$36.82 (over 300% upside from the then‑current price), while highlighting Wave 2 integration execution, Avon brand revitalization, free‑cash‑flow inflection and competition from Grupo Boticário as central risks.

Event‑driven note on the binding agreement to sell Avon International to Regent for a nominal £1 plus potential contingent payments up to GBP 60 million, which BTG views as a positive step in simplifying the group, eliminating a cash‑burning asset that consumed about R$1 billion in H1 2025, and supporting balance‑sheet deleveraging. The report nonetheless reiterates a neutral recommendation and R$18 target, stressing that high leverage, the ongoing turnaround of Avon in Latin America, and successful completion of Wave 2 integration remain crucial before a more constructive equity thesis can be justified.

2Q25 results report highlighting that consolidated net revenue (excluding Avon International) fell 2% year‑on‑year and came 9% below BTG’s estimate, as Avon LatAm beauty and Home & Style segments posted double‑digit declines and consultant numbers dropped due to Wave 2 implementation, partially offset by strong Natura brand growth and 80‑bp gross‑margin expansion. BTG underscores rising net debt to 2.18x EBITDA, continued integration costs, and the need for sustained margin and cash‑flow improvement, maintaining a neutral stance and R$18 target while monitoring progress on Avon recovery, leverage and free‑cash‑flow generation.