By Brazil Stock Guide – Rede D’Or (B3: RDOR3) remains one of Brazil’s most compelling healthcare plays, according to Banco Safra, which reiterated its Buy rating and set a R$55.50 price target. Despite fourth-quarter 2025 results coming in slightly below expectations, Safra argues that disciplined execution, ongoing capacity expansion and forward multiple compression continue to underpin the investment case. The stock trades at 16.2 times estimated 2026 earnings, below its historical average.
Brazil’s largest private hospital operator continues to expand its installed base while improving its procedure mix, with greater exposure to higher-margin surgeries and oncology. Safra estimates operational beds could grow around 5% over the next five years. The company currently operates 10,351 beds, about 16% of which are concentrated in the Atlântica D’Or joint venture. A faster-than-expected ramp-up at the JV has reduced execution risk and strengthened incremental revenue generation.
Hospital margins faced temporary pressure from a more complex case mix, which lifted operating costs. Management maintains that this does not reflect structural healthcare inflation. Safra projects nominal EBITDA growth of roughly 18% between 2026 and 2028, driven by higher occupancy rates, pricing adjustments and operating leverage as fixed costs are diluted.
In health insurance, SulAmérica continues to deliver consistent margin expansion and beneficiary growth. In 2025, it accounted for 26% of the sector’s net additions, reaching a 5.9% market share without resorting to aggressive pricing. Safra trimmed its EBITDA estimates by 1% and net income projections by 8% for 2026–2028, reflecting higher financial expenses. Even so, the bank sees an attractive risk-reward profile as Brazil’s private healthcare sector continues to consolidate.
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