Petrobras: Still Undervalued, But No Longer A Bargain As Iran Risks Cloud The Near-Term

Petrobras is downgraded to Buy after a 62% rally but remains undervalued, with long-term upside from Brazil's macro and investment cycle tailwinds. PBR's elevated CAPEX through 2028 will pressure free cash flow and dividends but support asset growth and position the company for post-cycle gains. Political risk and a new 10% dividend withholding tax for nonresident investors temper upside, while state ownership remains a persistent valuation overhang.