Marcopolo: the bus maker that costs just 3.8 years of profit

POMO4Marcopolo

Bus & vehicle makerFormula: Décio Bazin · Price R$ 3.68 (Friday close)

From micro-buses to intercity coaches, Marcopolo builds bus bodies in plants from Brazil to China. Every R$ 100 of its stock paid, on average, R$ 7.20 a year in dividends over five years.

The thesis

Marcopolo makes buses, and lately it has made good money doing it. In the last 12 months it earned about R$ 28.30 for every R$ 100 of shareholders' money, and R$ 22.30 a year on average over five years. Yet the whole company costs about 3.8 years of profit, and the stock trades at roughly what its net assets are worth on paper. At R$ 3.68 it sits 16.9% below the R$ 4.43 ceiling of Bazin's 6% rule. The market is betting bus orders will slow; with little debt, about 1.0 times a year of EBITDA, Marcopolo has room to get through a slow patch.

What the company does

Marcopolo, based in Caxias do Sul (Rio Grande do Sul), builds bus bodies: city buses, micro-buses, intercity and touring coaches, plus some rail vehicles, in plants in Brazil, Argentina, Mexico, Colombia, China, Australia and South Africa. Part of its demand comes from government programs such as Caminho da Escola (school buses), Novo PAC and MOVE. In November 2025 it declared R$ 0.78 per share in dividends and JCP, which Bradesco BBI estimated lifted the payout to about 118%, against a history of around 50%.

Discount to ceiling16.9%Price R$ 3.68 vs ceiling R$ 4.43: room before the formula calls it too expensive

5-yr avg dividend yield7.2%About R$ 7.20 a year in cash per R$ 100 invested, on average

Dividend yield, last 12 months25.4%Well above the 5-year average: likely boosted by one-off payouts

Net debt / EBITDA1.0xLittle net debt

Why the formula picked it

Dividends in each of five years, a 47.2% five-year payout (under the 75% cap) and net debt about 1.0 times EBITDA (under 2.5). Five companies passed. Cemig ranked first but was picked in the last four weeks, and CPFL went to Barsi, so Marcopolo, third, takes the slot. It also topped Buffett's ranking with an earnings yield of 26.3%, which is why Buffett's pick this week is Petrobras.

Bear case

The 25.4% trailing yield is not a run rate: it rests on that November 2025 payout, far above the usual level. Profit is turning down: in the second quarter of 2026 it fell 15.5% from a year earlier, and the EBITDA margin dropped from 17.3% to 14.3%, partly because of restructuring at Metalsur, its Argentine subsidiary. And bus orders swing with the economy and with public programs.

What would break the story

The 5-year average yield falling under 6%, payout above 75%, net debt reaching 2.5 times EBITDA, or a price above R$ 4.43. Outside the formula: margins that keep shrinking after the second quarter, or a long drought in bus orders.

Since the screen picked it

Start: November 6, 2026 · R$ 3.68

	POMO4	Ibovespa	Difference
So far	First update on the next Saturday
3 months	On February 6, 2027
6 months	On May 6, 2027
9 months	On August 6, 2027
12 months	On November 6, 2027

Price change only: dividends are not included, in the stocks or in the benchmark. The Ibovespa is measured through BOVA11, the ETF that tracks it. Prices: B3 end of day. Updated every Saturday. Past results do not predict future ones.

All the numbers

PriceR$ 3.68

Ceiling priceR$ 4.43

Discount to ceiling16.9%

5-yr avg dividend yield7.2%

Dividend yield, last 12 months25.4%

5-yr avg payout47.2%

Net debt / EBITDA1.0x

ROE, last 12 months28.3%

P/E3.8

Also passed: CMIG4, BBSE3, GGBR4

Sources for the company facts

Financial numbers: B3 closing prices (Friday) and CVM filings, computed by our screen.

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