Telefonica Latin America Luster Seen Fading as Brazil Slows

Telefonica SA’s days of guaranteed earnings expansion in Latin America may be over, leaving Chief Executive Officer Cesar Alierta with few growth markets as he tries to sell a stake in the assets to repay debt.

Revenue growth from the 15 countries including Brazil and Peru is poised to slow to 2.7 percent in 2013 from 12 percent last year, according to an estimate by Sanford C. Bernstein. Telefonica Brasil SA, which made almost half of Telefonica’s 29 billion euros ($35 billion) in Latin American sales last year, may see its 2012 profit margins drop to the lowest level since at least 2004, Banco de Sabadell analysts predict.