Jefferies has initiated research coverage on Compass Gas e Energia with a buy recommendation and a 12-month price target of 37 reais per share, according to its May 28, 2026 note. That target equates to an approximate 38% premium to the stock's quoted price of 26.85 reais, which remains slightly below the company's initial public offering price of 28 reais.
The brokerage constructs its valuation around a blended 7.7x enterprise value to EBITDA multiple on 2026 estimates. Jefferies applies an 8x EV/EBITDA multiple to the group's regulated gas distribution businesses - primarily São Paulo-based Comgás and the Commit portfolio - and a 5x multiple to Edge, the group's trading and infrastructure operations.
By contrast, Compass currently trades at 6.4x EV/EBITDA on Jefferies' 2026 forecast, a level the bank notes is roughly an 11% discount to the Brazilian utilities median multiple of 7.2x based on its dataset. In its initiation commentary, Jefferies argues that the market does not fully reflect several of Compass' strengths: strong free cash flow at flagship distributor Comgás, operational improvements and expansion potential across smaller distributors, and the group's capacity to increase share in liberalised gas markets.
Compass Gas is 58% owned by Cosan and, through Comgás, commands a roughly 45% share of Brazil's gas distribution market. Comgás is the dominant earnings contributor within the group, accounting for about 70% of consolidated EBITDA, and it operates under a concession that runs through 2049.
Jefferies points to the 2025-29 tariff review for Comgás, approved in September 2025, as a relevant regulatory framework for investors. The review established a regulatory weighted average cost of capital of 5.82%, a maximum initial margin of 1.028 reais per cubic metre and an efficiency X-factor of 0.69%. The tariff review also includes provisions for quarterly pass-through of gas costs.
The Commit division, which Compass acquired from Petrobras in 2022 for 2.10 billion reais, holds stakes in six regional distributors and represents about 17% of group EBITDA. Jefferies highlights three Commit concessions - CGE Rio, MSGas and Necta - that expire between 2027 and 2029, and identifies their pending renewals as potential catalysts for the group's outlook.
Edge, the group's trading and infrastructure arm, operates the liquefied natural gas regasification terminal in São Paulo and has entered the biomethane market through a joint venture with Orizon, providing exposure to emerging segments within the gas value chain.
On the financials, Compass reported group revenue of 16.60 billion reais in fiscal 2025 and adjusted EBITDA of 4.97 billion reais. Jefferies projects revenue of 17.46 billion reais in 2026 and 19.18 billion reais in 2027, with adjusted EBITDA rising to 5.07 billion reais and 5.22 billion reais in those years, respectively.
Adjusted earnings per share are forecast by Jefferies at 2.07 reais in 2026 and 2.31 reais in 2027, up from 1.80 reais in 2025. Free cash flow was recorded at 2.16 billion reais in 2025; the broker models FCF of 1.19 billion reais in 2026, recovering to 1.68 billion reais in 2027 as capital expenditure is projected at 2.28 billion reais and 2.35 billion reais in 2026 and 2027 respectively. Net debt at the end of the first quarter of 2026 stood at 12.80 billion reais.
To frame its valuation range, Jefferies publishes a 12-month upside scenario of 46.30 reais per share and a downside scenario of 18.50 reais, which together imply a risk-reward ratio of about 2.33 to 1. For market context, the stock has a 52-week trading range of 25.00 to 28.35 reais, a market capitalisation of 19.20 billion reais and a free float of 14.1%.
What investors should watch
- Regulatory outcomes tied to Comgás' concession and tariff frameworks, including WACC, margins and cost pass-through mechanisms.
- Renewal decisions for Commit concessions CGE Rio, MSGas and Necta between 2027 and 2029.
- Execution of operational efficiencies across smaller distributors and the group's ability to grow share in liberalised gas markets, as flagged by Jefferies.