Financial institution Banco Bradesco continues to regain its footing, though the capital market remain cautious in their anticipation.
Banco Bradesco Shows Strong Financial Performance in Q2 2025
Banco Bradesco (BBD) has maintained its operational improvement path in Q2 2025, with a remarkable financial performance that outperforms several local peers. The bank's recurring net profit for the quarter reached R$6.1 billion, marking a 28.6% growth year-over-year (YoY).
The bank's stock continues to operate with depressed multiples, trading around $2.80 per share, and has a market capitalization of approximately $27.45 billion as of early August 2025. The forward-looking valuation metrics indicate that BBD trades at a forward P/E ratio between about 5.9 and 7.0, implying the market currently values it at a discount relative to expected future earnings.
The bank's revenue for Q2 2025 increased by 15% YoY to roughly $9.91 billion. This growth was driven by a 10.6% YoY increase in operating revenue from commissions and fees, which reached R$10,307B. The restructured portfolio decreased by 21% YoY and now represents only 4% of the total portfolio.
The provisioning ratio largely covers problematic exposure, with levels above 100% on the at-risk portfolio. Portfolio quality remained under control, with late payments over 90 days remaining at 4.1%. The Return on Equity After Tax (ROAE) for BBD in Q2 2025 rose to 14.6%.
The bank's profitability, efficiency, and quality of its portfolio continue to recover. The card business increased its revenue by 19.9% YoY and reached a record R$4,460b. Credit growth for BBD in Q2 2025 remained above the sector average.
BBD's current model is based on the strength of its balance sheet, the strength of its insurance franchise, and an active dividend distribution policy. The bank currently pays a dividend yield of 7.83%, more than double the industry average.
However, some headwinds remain. The bank cautions about a potential economic slowdown in the latter half of 2025, impacting demand and growth. Operating expenses have increased by 5.8%, in line with inflation pressures. Net interest margins remain compressed, which could constrain profitability.
Despite these challenges, analysts generally recommend the stock as a strong buy with potential for valuation appreciation as Brazil’s financial sector evolves. The estimated growth of EPS FWD is 14.7%, 50% higher than the sectoral average and almost three times BBD's own 5-year average.
In the insurance segment, BBD delivered a net profit of R$2.3 billion (+4.4% YoY) and an ROAE of 21.4%. This robust performance further solidifies Banco Bradesco's position as a financially solid institution with a market valuation reflecting a cautious but positive outlook.
- Banco Bradesco's financial performance in real estate, technology, and investment sectors has also shown significant growth, with a 15% increase in revenue for Q2 2025.
- The bank is actively investing in technology, which has contributed to the growth in its card business, with a 19.9% YoY increase in revenue.
- In the insurance segment, Banco Bradesco has also maintained a strong financial performance, with a net profit of R$2.3 billion (+4.4% YoY) and an ROAE of 21.4%.
- The bank's strong financial performance in Q2 2025 and its price-to-earnings ratio, which is lower than the sector average, makes it an attractive investment option in the finance and business sectors.
