CIA SANEAMENTO BASICO DE-ADR (NYSE:SBS) – A Strong Contender for CANSLIM Investors

CIA SANEAMENTO BASICO DE-ADR (NYSE:SBS) stands out as a potential candidate for investors following the CANSLIM strategy. The stock meets several key criteria of the system, including strong earnings growth, solid profitability, and favorable technical trends. Below, we examine why SBS aligns with CANSLIM principles.

Key CANSLIM Criteria Met by SBS

• Current Earnings Growth (C): SBS reported an 80.8% year-over-year increase in quarterly EPS, well above the CANSLIM threshold of 20%. Revenue also grew by 28.6%, reinforcing the company’s momentum.
• Annual Earnings Growth (A): The three-year EPS growth rate stands at 60.8%, exceeding the 25% minimum requirement. Return on equity (ROE) is strong at 26.7%, indicating efficient capital use.
• Relative Strength (L): With a ChartMill Relative Strength score of 91.7, SBS outperforms most of the market, a hallmark of CANSLIM leaders.
• Institutional Sponsorship (I): Institutional ownership is at 40.2%, below the 85% threshold, suggesting room for further institutional interest.
• Debt Levels (S): The debt-to-equity ratio of 0.65 is conservative, aligning with CANSLIM’s preference for financially stable companies.

Technical and Fundamental Strength

The stock’s technical rating is a perfect 10, supported by positive short- and long-term trends. SBS is trading near its 52-week high, reflecting strong market confidence.

Fundamentally, SBS scores well on profitability and valuation, with a P/E ratio of 7.8—below both industry and S&P 500 averages. However, future EPS growth is expected to decline slightly, which investors should monitor.

For a deeper look, review the full fundamental analysis and technical report.

Our CANSLIM High Growth screener lists more stocks matching this strategy and is updated daily.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should always conduct your own analysis before making investment decisions.