Centrais Elétricas Brasileiras Eletrobras (EBR)
Market Cap: $3 billion
Dividend Yield: 18.4%
YTD Price Performance: -14%
Centrais Elétricas Brasileiras (EBR) — also know as Eletrobras, Latin America’s largest utility company — is also taking a hit for reasons well beyond its control.
Brazil had the third-highest electricity prices in the world until the government targeted a reduction of 20% as part of stimulus program. That took a huge bite out of Elertrobras’s margins. For the most recent fiscal year, Electrobras posted a net loss of $3.4 billion, all because the government forced to accept lower prices. Analysts forecast Electrobras to book a net loss this year, too.
The current economic and political environment makes it hard to see what possible catalyst could pull EBR stock out of negative territory any time soon. EBR’s payouts have been erratic, so the stock’s dividend yield is basically a roll of the dice. Worst of all, EBB still has no profits. For dividend stocks, that’s another dealbreaker.