# Companhia de Saneamento Básico do Estado de São Paulo - SABESP (SBSP3.SA)

Canonical: https://gigainvestors.com/s/SBSP3.SA

Analysis as of: 2026-10-16T07:34:38.846Z. Financial observations: FY2000–FY2026.

Listing currency: BRL. Reporting currency: BRL.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: BRL 31.87 per share; close as of 2026-10-15.

Estimated value: low BRL 21.96 per share, central BRL 23.14 per share, high BRL 24.50 per share. Buy at or below the central value BRL 23.14 per share. Valuation as of 2026-10-16T07:34:38.846Z; scenarios are not confidence intervals.

Expected annual return: 12.3% at the stated quote. About 12.3% a year at today's price (required return 17.0%). required return 17.0% a year (BR 10-year bond 13.0% + 4 points).

## Checklist

### understandable: pass

- 1 revenue decline in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 1

- Years with a net loss: 0

- Operating margin variation: 0.22×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.27×

- FY2018: 0.32×

- FY2019: 0.32×

- FY2020: 0.25×

- FY2021: 0.21×

- FY2022: 0.21×

- FY2023: 0.25×

- FY2024: 0.43×

- FY2025: 0.32×

- LTM to Jun 2026: 0.31×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 10.3%

- ROIC, second-lowest year: 7.9%

- Typical minus recent gross margin: 0.6 pp

- Typical gross margin (annual median): 37.2%

- Recent gross margin (lower of latest and 3-year median): 36.6%

- Years with nonpositive capital: 0

- Capital spending / revenue: 0.3%

- ROIC including acquisitions, ten-year median: 13.3%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 9.8%

- FY2017: 10.4%

- FY2018: 12.6%

- FY2019: 12.6%

- FY2020: 9.0%

- FY2021: 7.5%

- FY2022: 7.9%

- FY2023: 10.2%

- FY2024: 27.7%

- FY2025: 12.7%

### economics: pass

- Owner earnings / net income, 5-yr: 1.41×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: BRL 38B

- Net income, five-year total: BRL 27B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: -0.0 pp

- Working capital / revenue, change between three-year averages: -0.2 pp

- Working capital / revenue, final three-year average: 12.3%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.84×

- FY2022: 1.75×

- FY2023: 1.72×

- FY2024: 1.26×

- FY2025: 1.22×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 10.4% vs 12.7%

- Per-share earnings: 3.69 to 12.34 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 0.0%

- Ordinary dilution, 5-year annual growth: 0.1%

- Market cap gain: BRL 14B

- Cumulative retained earnings: BRL 15B

- Diluted shares, 10-year annual growth: 0.0%

- Diluted shares, 5-year annual growth: 0.1%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 16.3%

- Per-share value change: BRL 8.65

- Per-share value, starting three-year median: BRL 3.69

- Per-share value, ending three-year median: BRL 12.34

- Buybacks concentrated in cheaper years (correlation): -0.50

- Average buyback yield: 2.9%

- Buyback history: 3 years

- Debt-funded buybacks: No

- Acquisition spending: BRL 38B

- Cumulative net income, 10 years: BRL 40B

- ROIC, first three-year median: 10.4%

- ROIC, last three-year median: 12.7%

Chart: Earnings per share; fiscal year observations.

- FY2016: BRL 4.31

- FY2017: BRL 3.69

- FY2018: BRL 4.15

- FY2019: BRL 4.93

- FY2020: BRL 1.42

- FY2021: BRL 3.37

- FY2022: BRL 4.57

- FY2023: BRL 5.16

- FY2024: BRL 14.02

- FY2025: BRL 12.34

### accounting: pass

- Sloan accruals: 0.1%

- Receivables to sales index (DSRI): 1.13×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 0.99×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 1.19×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -0.2%

- FY2017: -2.0%

- FY2018: -2.3%

- FY2019: -1.8%

- FY2020: -7.9%

- FY2021: -3.0%

- FY2022: -1.5%

- FY2023: -2.2%

- FY2024: 2.7%

- FY2025: 0.1%

## Holders

## Price story

Price needs cash profits to grow 6.6% a year for ten years · sales +7.3%

Story as of 2026-10-16T10:00:01.703Z; price observation 2026-10-15.

Price needs cash profits to grow 6.6% a year for ten years

### Sales · FY2025–2026

sales +7.3%; source https://www.sec.gov/Archives/edgar/data/1170858/000129281426002681/sbsform20f_2025.htm; observed 2026-04-29.

- FY2017: BRL 15B 

- FY2018: BRL 16B 

- FY2019: BRL 18B 

- FY2020: BRL 18B 

- FY2021: BRL 19B 

- FY2022: BRL 22B 

- FY2023: BRL 26B 

- FY2024: BRL 36B 

- FY2025: BRL 38B 

- FY2026: BRL 41B 

### Gross margin · FY2025

gross margin 36.6%; source https://www.sec.gov/Archives/edgar/data/1170858/000129281426002681/sbsform20f_2025.htm; observed 2026-04-29.

- FY2016: 36.1% 

- FY2017: 39.9% 

- FY2018: 43.5% 

- FY2019: 43.6% 

- FY2020: 37.2% 

- FY2021: 34.3% 

- FY2022: 34.9% 

- FY2023: 37.2% 

- FY2024: 54.1% 

- FY2025: 36.6% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in utilities regulated water; annual sales are BRL 38.1 billion.

- Source: https://www.sec.gov/Archives/edgar/data/1170858/000129281426002681/sbsform20f_2025.htm (filed 2026-04-29); FY2025: revenue 38092050000; grossProfit 13955654000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); SBSP3.SA: Companhia de Saneamento Básico do Estado de São Paulo - SABESP provides basic and environmental sanitation services in the São Paulo State, Brazil. It supplies treated water and sewage services on a wholesale basis. Companhia de Saneamento Básico do Estado de São Paulo - SABESP was founded in 1954 and is headquartered in São Paulo, Brazil.

### Why customers stay

Margins ranged from 36.6% to 54.1% during 2023–25; it earns 10.3% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2023: grossProfit / revenue = 37.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2024: grossProfit / revenue = 54.1%.

- Source: https://www.sec.gov/Archives/edgar/data/1170858/000129281426002681/sbsform20f_2025.htm (filed 2026-04-29); FY2025: grossProfit / revenue = 36.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); 10-year return on capital observations [[2016,0.09781682251368995],[2017,0.10369928628611973],[2018,0.12577471831709447],[2019,0.12564480536832798],[2020,0.08995229807690061],[2021,0.07544597422714495],[2022,0.07938170321574152],[2023,0.10196469904240857],[2024,0.27693255506100756],[2025,0.12676737721106504]]; median 0.10283199266426415. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Can it raise prices

"This tariff adjustment became effective on January 1, 2026." (SEC filing, Apr 2026)

- Source: https://www.sec.gov/Archives/edgar/data/1170858/000129281426002681/sbsform20f_2025.htm (filed 2026-04-29); This tariff adjustment became effective on January 1, 2026.

### Where the cash goes

Paid dividends in 10 of 10 years; bought back BRL 475.4 million of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2016: growth capex 53609956.939606905; upkeep 2082188043.060393; owner earnings 1973718956.939607. Growth capex / owner earnings = 0.027161900001575198.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2017: growth capex 0; upkeep 18920000; owner earnings 3730262000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2018: growth capex 0; upkeep 50645000; owner earnings 4106764000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2019: growth capex 0; upkeep 78159000; owner earnings 4852621200. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2020: growth capex 0; upkeep 42407000; owner earnings 2737262200. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2021: growth capex 0; upkeep 50281000; owner earnings 4231574000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2022: growth capex 0; upkeep 73668000; owner earnings 5451823200. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2023: growth capex 0; upkeep 147249000; owner earnings 6076836000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); FY2024: growth capex 0; upkeep 100728000; owner earnings 12061863400. Growth capex / owner earnings = 0.

- Source: https://www.sec.gov/Archives/edgar/data/1170858/000129281426002681/sbsform20f_2025.htm (filed 2026-04-29); FY2025: growth capex 0; upkeep 291990000; owner earnings 10323532000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); Dividend observations: [[2016,139399000],[2017,765933000],[2018,653393000],[2019,739996000],[2020,890095000],[2021,254218000],[2022,603541000],[2023,823671000],[2024,928851000],[2025,2363776000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/1170858/000129281426002681/sbsform20f_2025.htm (filed 2026-04-29); FY2025: cash repurchases 475385000 BRL.

### Are managers owners

Insiders own 33% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); SBSP3.SA SharesStats.PercentInsiders = 33.001000000000005 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 6.6% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-29); Ten-year compound average after fade. Initial solved rate 0.0818439175824133. Price 31.87; FX 1; discount 0.1695; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share -1.2745180449826137 → FY2025 15.053504042713994. Closing-price date 2026-10-15.

## Monthly share-price history (BRL per share)

- 2016-11: BRL 5.81 per share

- 2016-12: BRL 5.58 per share

- 2017-01: BRL 6.08 per share

- 2017-02: BRL 6.38 per share

- 2017-03: BRL 6.32 per share

- 2017-04: BRL 5.68 per share

- 2017-05: BRL 5.62 per share

- 2017-06: BRL 6.14 per share

- 2017-07: BRL 6.51 per share

- 2017-08: BRL 6.23 per share

- 2017-09: BRL 6.45 per share

- 2017-10: BRL 5.78 per share

- 2017-11: BRL 6.34 per share

- 2017-12: BRL 6.66 per share

- 2018-01: BRL 7.06 per share

- 2018-02: BRL 7.30 per share

- 2018-03: BRL 6.79 per share

- 2018-04: BRL 6.82 per share

- 2018-05: BRL 5.07 per share

- 2018-06: BRL 4.52 per share

- 2018-07: BRL 4.85 per share

- 2018-08: BRL 4.73 per share

- 2018-09: BRL 4.57 per share

- 2018-10: BRL 5.42 per share

- 2018-11: BRL 5.47 per share

- 2018-12: BRL 6.11 per share

- 2019-01: BRL 8.41 per share

- 2019-02: BRL 7.63 per share

- 2019-03: BRL 8.15 per share

- 2019-04: BRL 9.11 per share

- 2019-05: BRL 8.57 per share

- 2019-06: BRL 9.17 per share

- 2019-07: BRL 10.36 per share

- 2019-08: BRL 10.03 per share

- 2019-09: BRL 9.62 per share

- 2019-10: BRL 10.59 per share

- 2019-11: BRL 11.13 per share

- 2019-12: BRL 11.74 per share

- 2020-01: BRL 11.83 per share

- 2020-02: BRL 11.39 per share

- 2020-03: BRL 7.58 per share

- 2020-04: BRL 7.77 per share

- 2020-05: BRL 10.53 per share

- 2020-06: BRL 11.19 per share

- 2020-07: BRL 11.80 per share

- 2020-08: BRL 9.26 per share

- 2020-09: BRL 9.08 per share

- 2020-10: BRL 8.24 per share

- 2020-11: BRL 8.64 per share

- 2020-12: BRL 8.62 per share

- 2021-01: BRL 7.93 per share

- 2021-02: BRL 7.14 per share

- 2021-03: BRL 7.99 per share

- 2021-04: BRL 8.30 per share

- 2021-05: BRL 7.59 per share

- 2021-06: BRL 7.09 per share

- 2021-07: BRL 6.88 per share

- 2021-08: BRL 7.01 per share

- 2021-09: BRL 7.48 per share

- 2021-10: BRL 6.83 per share

- 2021-11: BRL 6.53 per share

- 2021-12: BRL 7.79 per share

- 2022-01: BRL 7.25 per share

- 2022-02: BRL 8.03 per share

- 2022-03: BRL 9.25 per share

- 2022-04: BRL 8.64 per share

- 2022-05: BRL 8.88 per share

- 2022-06: BRL 8.18 per share

- 2022-07: BRL 8.66 per share

- 2022-08: BRL 9.53 per share

- 2022-09: BRL 9.62 per share

- 2022-10: BRL 11.66 per share

- 2022-11: BRL 11.69 per share

- 2022-12: BRL 11.08 per share

- 2023-01: BRL 10.79 per share

- 2023-02: BRL 10.04 per share

- 2023-03: BRL 9.81 per share

- 2023-04: BRL 8.95 per share

- 2023-05: BRL 10.19 per share

- 2023-06: BRL 10.97 per share

- 2023-07: BRL 11.27 per share

- 2023-08: BRL 11.23 per share

- 2023-09: BRL 11.84 per share

- 2023-10: BRL 11.32 per share

- 2023-11: BRL 13.10 per share

- 2023-12: BRL 14.62 per share

- 2024-01: BRL 15.29 per share

- 2024-02: BRL 15.35 per share

- 2024-03: BRL 16.43 per share

- 2024-04: BRL 15.67 per share

- 2024-05: BRL 14.32 per share

- 2024-06: BRL 14.54 per share

- 2024-07: BRL 17.11 per share

- 2024-08: BRL 18.37 per share

- 2024-09: BRL 17.53 per share

- 2024-10: BRL 17.86 per share

- 2024-11: BRL 18.03 per share

- 2024-12: BRL 17.16 per share

- 2025-01: BRL 18.34 per share

- 2025-02: BRL 18.42 per share

- 2025-03: BRL 19.78 per share

- 2025-04: BRL 22.09 per share

- 2025-05: BRL 22.76 per share

- 2025-06: BRL 23.10 per share

- 2025-07: BRL 21.00 per share

- 2025-08: BRL 23.75 per share

- 2025-09: BRL 25.63 per share

- 2025-10: BRL 25.57 per share

- 2025-11: BRL 27.34 per share

- 2025-12: BRL 26.64 per share

- 2026-01: BRL 28.20 per share

- 2026-02: BRL 30.73 per share

- 2026-03: BRL 31.65 per share

- 2026-04: BRL 33.15 per share

- 2026-05: BRL 27.95 per share

- 2026-06: BRL 29.64 per share

- 2026-07: BRL 27.70 per share

- 2026-08: BRL 25.28 per share

- 2026-09: BRL 27.43 per share

- 2026-10: BRL 32.54 per share

## Annual estimated value (BRL per share)

- FY2016: low BRL 7.12 per share, central BRL 7.45 per share, high BRL 7.83 per share

- FY2017: low BRL 7.86 per share, central BRL 8.20 per share, high BRL 8.59 per share

- FY2018: low BRL 23.72 per share, central BRL 25.07 per share, high BRL 26.62 per share

- FY2019: low BRL 44.86 per share, central BRL 49.80 per share, high BRL 53.37 per share

- FY2020: low BRL 46.50 per share, central BRL 51.19 per share, high BRL 54.68 per share

- FY2021: low BRL 49.53 per share, central BRL 54.77 per share, high BRL 58.62 per share

- FY2022: low BRL 52.37 per share, central BRL 55.64 per share, high BRL 59.41 per share

- FY2023: low BRL 57.34 per share, central BRL 60.99 per share, high BRL 65.19 per share

- FY2024: low BRL 82.17 per share, central BRL 87.33 per share, high BRL 93.26 per share

- FY2025: low BRL 99.27 per share, central BRL 104.90 per share, high BRL 111.39 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:40:23.136Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original 20-F filing](https://www.sec.gov/Archives/edgar/data/1170858/000129281426002681/sbsform20f_2025.htm); period 2025-12-31, filed 2026-04-29.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.