Inter shares are on fire this year and are unlikely to cool down anytime soon, according to Citi. Analyst Rafael Frade upgraded the Brazilian company — which has a ” super app ” that combines e-commerce, investing, airplane ticket purchasing and other services — to buy from neutral. He also raised his price target to $5.30 per share from $2 per share. The new target implies upside of 33% from Thursday’s close. Frade noted that Inter’s second-quarter results made him more confident in the company’s ability to deliver stronger returns going forward. “INTR has been signaling its intention to reach higher [return on equity] via the repricing of its credit portfolio and keeping expenses under control. However, we were unsure about how long the process would take,” Frade wrote Wednesday. “We believe that 2Q23 results show good advances in this direction, with potential further improvements in [net interest margins] coming from new initiatives and lower rates, while cost-of-risk could present material improvement from higher restrictions on credit card origination.” Inter earlier this week reported net income and revenue for the second quarter that beat analyst expectations. The company also reported its client base grew by 34% to 27.8 million from the year-earlier period. Inter shares have had a stellar year, rallying 80% in that time. This week alone, it’s up 16%. INTR YTD mountain INTR in 2023 — CNBC’s Michael Bloom contributed reporting.
