May 2 (Bloomberg) -- Minerva SA, Brazil’s third-largest beef producer, advanced the most in seven weeks after Standard & Poor’s raised its credit rating by one level.
The shares gained 5.2 percent to 11.99 reais at the close of trading in Sao Paulo, the steepest one-day gain since March 13. It was the second biggest advance in the BM&FBovespa Small Cap index, which fell 0.5 percent, resuming trading after a holiday on May 1. The meatpacker’s bonds due in 2023 rose 0.59 cent to 108.03 cents on the dollar, the highest price since March 18.
S&P raised the Barretos-based company’s rating to BB-, or three levels below investment grade, after markets closed on April 30, citing its improved capital structure and liquidity levels. Minerva has increased gross margins and cash-flow generation, according to S&P.
“Cattle prices will continue to be favorable in the next two to three years, contributing to Minerva’s gradually improving credit metrics,” S&P analysts wrote in the report.
Minerva shares have gained 6.7 percent this year, while the small cap index dropped 4.1 percent.
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