Gafisa SA (GFSA3), the Brazilian homebuilder whose sales missed estimates in the past two quarters, fell as new projects trailed the company’s projections, fueling concern that revenue will decline.
Shares dropped 1.7 percent to 3.47 reais at 2:08 p.m. in Sao Paulo, the second-worst performance on the Ibovespa (IBOV), which added 2.3 percent. The stock earlier fell as much as 3.7 percent to the lowest intraday level since Sept. 17.
Gafisa started 1.3 billion reais ($603 million) of new projects in the first nine months of 2013, compared with the company’s projection for the year of 2.7 billion reais to 3.3 billion reais, according to a regulatory filing yesterday after the market closed. The homebuilder reported 7,779 units turned over to buyers, or 50 percent of annual projections.
“The low levels of starts of new projects and deliveries will lead to a cut in estimates for the company’s cash flow,” Eduardo Silveira, an analyst at BES Securities in Sao Paulo, said in a phone interview.
The Sao Paulo-based company is scheduled to release full third-quarter results on Nov. 13. The average estimate among six analysts surveyed by Bloomberg is for annual sales of 3.4 billion reais this year, a decline of 16 percent from 2012.
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