Breaking Down BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) Financial Health: Key Insights for Investors

You're looking at BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) and trying to map the real estate value against the volatile commodity cycle, which is defintely the right way to think about this land-rich operation. The company just closed out a mixed but ultimately profitable fiscal year 2025, reporting annual revenue of R$ 1.06 Billion (up 3.73% year-over-year), but net income dropped to R$ 138.02 Million, showing the pressure on margins. Still, the underlying operational story is one of a strong turnaround in profitability, evidenced by the nine-month period ending March 2025 (9M25) swinging from a net loss to a R$ 76.7 Million net income, largely driven by a 43% jump in net sales revenue and margin expansion from their soybean segment. The near-term risk remains the classic agricultural double-whammy: fluctuating global commodity prices, plus the very real threat of inconsistent rainfall affecting the 2025/2026 planting schedule. The play here isn't just farming; it's about the $0.69 Billion USD in total assets-the land itself-and how management monetizes that portfolio. We need to see if the recent operational efficiencies can sustain that profitability in the face of macro headwinds.

Revenue Analysis

You need to see where the money is actually coming from at BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND), because their business model isn't just farming; it's a mix of commodity sales and land development (Real Estate). For the fiscal year ending June 30, 2025, the company reported annual revenue of approximately R$1.06 billion (Brazilian Reais), marking a modest year-over-year growth of 3.73%.

Primary Revenue Streams and Growth Dynamics

The company's revenue is fundamentally split between two major activities: the sale of agricultural products (operational revenue) and the sale of improved farmland (Real Estate). This dual-engine model is what makes BrasilAgro - Companhia Brasileira de Propriedades Agrícolas's financials unique, but it also introduces volatility. The six main segments they operate through are Real Estate, Grains (Soybean, Corn, Sorghum), Sugarcane, Cattle Raising, Cotton, and Other crops.

The operational side of the business showed better momentum in the first nine months of the fiscal year, with revenue from operations increasing by a solid 20% year-over-year, reaching R$648.7 million in 9M25. Honestly, that's a good sign for their core farming execution, especially given the tough agricultural cycle. But, you have to look at the whole picture.

• Operational Revenue: Driven by Grains, Sugarcane, Cattle Raising, and Cotton sales.
• Real Estate Revenue: Sale of developed farmland; a high-margin, lumpy revenue source.
• The 2025 fiscal year saw a significant drop in farm sales in the fourth quarter.

Segment Contribution and Near-Term Shifts

The contribution of the Real Estate segment is the biggest swing factor. For example, a single transaction-the second part of the Alto Taquari farm sale-contributed R$189.4 million to the top line early in the 2025 fiscal year. That's a huge, non-recurring boost. So, when you look at the total nine-month net revenue of R$870.5 million, the Real Estate component is clearly essential.

Here's the quick math: the operational revenue for 9M25 was R$648.7 million, meaning the remaining R$221.8 million was primarily non-operational, like land sales, which is a significant chunk. This is why the 4Q25 net revenue dropped by -34% year-over-year to BRL 340.7 million; farm sales fell by 61% in that quarter, defintely impacting the overall annual growth rate.

The growth in the Grains segment, particularly Soybean operations, was a key operational bright spot, with gross income jumping from R$27.4 million to R$48.8 million in the first nine months of the year, driven by higher volumes sold. This shows that while the land sales are volatile, the core farming business is improving its efficiency and volume. For a deeper dive into who is betting on this model, check out Exploring BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) Investor Profile: Who's Buying and Why?

Profitability Metrics

You need to look past the top-line revenue number for BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) and focus on the margins. Honestly, the 2025 fiscal year (FY25) data shows a company struggling with the cost-price squeeze, which is the core challenge for any large-scale commodity producer right now.

For the trailing twelve months (TTM) ended September 2025, the picture is clear: LND's core operations are not generating profit. The Gross Profit Margin-what's left after the cost of goods sold-is a thin 10.44%. This is a red flag, especially when compared to the average gross margin of 30.8% for the US Agricultural Inputs sector.

Here's the quick math on the margins for the TTM period ending Q4 2025:

• Gross Profit Margin: 10.44%
• EBIT Margin (Operating Profit Margin): -3.24%
• Net Income Margin: -2.56%

A negative Operating Profit Margin means the company is losing money just from its day-to-day farming and land-management activities before factoring in interest and taxes. The company's TTM revenue was approximately R$927.27 million, but the net result was a loss of R$-23.7 million.

Operational Efficiency and Cost Management

The low Gross Profit Margin of 10.44% points directly to operational efficiency issues, or more accurately, the harsh reality of the agricultural cycle. Input costs, while easing from their 2022 peaks, are still high, and commodity prices for key crops like soybeans and corn have softened globally. LND's cost of goods sold is eating up nearly 90% of its revenue. That's a defintely tight spot.

The challenge is amplified when you look at a major competitor. For instance, SLC Agrícola, a peer in the Brazilian agribusiness space, reported an Adjusted EBITDA Margin of 40.5% in Q1 2025. This stark contrast highlights that LND's diversified model-which includes real estate sales-is currently masking a deeply unprofitable core farming operation.

The company's profitability is heavily reliant on non-operational items, particularly the sale of developed farmland. Analysts have noted that excluding land sales, BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) has posted continued operational losses. This volatility is a key risk for investors:

The Q1 2026 net loss of R$64.3 million shows that even with a strategic shift of soy sales to the second half of the year, the business remains highly susceptible to market and accounting volatility. You should treat the operational results (the negative EBIT margin) as the true indicator of the farming business's health, and the Net Income swings as the result of their real estate development strategy and financial adjustments.

If you are interested in how the market views this complex structure, you should be Exploring BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) Investor Profile: Who's Buying and Why?

Debt vs. Equity Structure

You want to know how BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) is funding its growth, and the short answer is: they are using a healthy mix of long-term debt, but their unique business model-buying, developing, and selling farmland-gives them a significant, debt-offsetting asset in the form of sales receivables. It's a land-rich, capital-intensive structure.

As of the most recent quarterly data for fiscal year 2025, the company's total debt-to-equity ratio (D/E) stood at approximately 0.63, or 63.10%. This means for every dollar of shareholder equity, the company uses about 63 cents of debt. To be fair, this is a manageable level, especially in the capital-heavy agricultural real estate business where assets are long-lived.

Here's the quick math on their debt breakdown as of March 31, 2025 (the 9-month mark for FY2025):

• Total Debt: R$ 885.0 million
• Short-Term Debt (maturing within one year): R$ 337.6 million
• Long-Term Debt (maturing after one year): R$ 547.4 million

The total debt figure is partially mitigated by their net debt position, which, as of the Q4 2025 report, had risen to BRL 725.7 million, a 54% annual increase, reflecting a challenging agricultural cycle. This leverage increase is something to watch, but the company's core strategy helps buffer it.

The real story in their financing is the balance between debt and their unique equity-like assets. BrasilAgro's debt is largely offset by R$ 815.6 million in farmland sales receivables, which are essentially future cash inflows from properties already sold. This asset is crucial; it's why the leverage, while rising, is still considered healthy by many analysts, especially since the company tends to fund its working capital needs with approximately 30% third-party capital and the rest from its own resources.

The debt itself is predominantly tied to the local Brazilian interbank deposit rate (CDI), with 90.59% of it indexed to the CDI. This ties the cost of debt directly to Brazil's benchmark interest rate (Selic), which was at 15.00% in June 2025. This is a high-rate environment, so the cost of carrying the debt is significant, which is why the company's net income can be volatile.

In terms of recent activity, the company has been active in the debt capital markets, including the issuance of debentures (a type of bond) to finance a significant irrigation project. This shows a preference for project-specific debt financing over common stock dilution for major capital expenditures. While a direct, major-agency credit rating isn't widely published, the company's financial health is generally viewed as stable, with a Piotroski F-Score of 6 as of November 2025, indicating a typical financial situation for a stable company.

Here is a quick look at the D/E ratio compared to a proxy in the broader Brazilian real estate development sector for context:

The higher ratio for BrasilAgro is expected, as their model is more capital-intensive and asset-heavy than a typical homebuilder, but it's a good reminder that they carry more financial leverage. If you want to dig deeper into who is funding this capital structure, you can start by Exploring BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) Investor Profile: Who's Buying and Why?

Liquidity and Solvency

You need to know if BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) has enough quick cash to meet its near-term obligations, and the answer is yes, but with a caveat typical for an agricultural business. Their liquidity position as of the most recent reporting period (Trailing Twelve Months, or TTM, data closest to November 2025) shows a healthy buffer, but also a reliance on selling off their harvest (inventory) to cover all immediate debts.

Current and Quick Ratios: A Closer Look

The company's ability to cover its short-term debt is measured by two key ratios. The Current Ratio, which includes all current assets like cash, receivables, and inventory, stands at a solid 1.67. This means for every dollar of current liability (short-term debt), BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) has $1.67 in current assets to cover it. That's defintely a good sign.

However, the Quick Ratio (also known as the Acid-Test Ratio), which strips out inventory-the least liquid current asset-is lower at 0.86. Here's the quick math: since the Quick Ratio is below 1.0, it tells you that without selling off its inventory, the company cannot cover all its current liabilities with just cash and accounts receivable. For a company focused on agricultural properties and commodity sales, this reliance on inventory is normal, but it's a risk if commodity prices drop or the harvest is delayed.

• Current Ratio: 1.67 (Strong short-term coverage).
• Quick Ratio: 0.86 (Shows reliance on inventory sales).

Working Capital and Cash Flow Trends

The company's Working Capital, the difference between current assets and current liabilities, is a positive $89.67 million USD. This positive figure indicates that the company has a net surplus of liquid assets to fund its day-to-day operations and growth. A positive working capital trend is crucial for an agricultural company that faces seasonal cash flow fluctuations.

Looking at the cash flow statement overview for the TTM period, the trends show strength in core operations and a healthy commitment to future growth. This is a powerful combination:

• Operating Cash Flow (OCF): The OCF was a strong positive $47.52 million USD. This is the cash generated from the core business of farming and selling agricultural products, and it's the lifeblood of the company.
• Investing Cash Flow (CFI): The CFI was a negative $20.91 million USD. A negative number here is actually a good thing; it means the company is spending money on long-term assets, like acquiring or developing new properties and equipment, which drives future revenue.
• Financing Cash Flow (CFF): While the exact TTM figure isn't the focus, the resulting Free Cash Flow (FCF)-the cash left over after capital expenditures-was a healthy $33.92 million USD. This is the cash available for dividends, debt reduction, or other strategic moves.

Near-Term Risks and Strengths

The primary liquidity strength is the robust, positive OCF and the resulting FCF. The company is generating enough cash from its operations to cover its investments and still have a significant surplus. The positive working capital of nearly $90 million USD also provides a solid cushion.

The main potential liquidity concern is the inventory reliance highlighted by the Quick Ratio. If there is a major, unexpected disruption to the commodity market-say, a sudden, sharp drop in soybean or corn prices-the value of that $558.96 million BRL in inventory (FY 2025) could be impaired, making it harder to cover short-term debt without taking on new financing. Still, the overall cash generation suggests they can handle typical market volatility. To dig deeper into who is betting on this model, you should be Exploring BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) Investor Profile: Who's Buying and Why?

Valuation Analysis

You want to know if BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) is a value trap or a genuine opportunity, and the valuation metrics from the 2025 fiscal year paint a complex picture. The short answer is that traditional earnings-based metrics suggest it is overvalued, but a deeper look at its asset base and cash flow points to a potential undervaluation, trading significantly below its book value.

As of November 2025, the stock is trading around the $3.50 mark, near the low end of its 52-week range of $3.47 to $4.18. The stock has defintely struggled, delivering a -12.34% change over the last year, reflecting the tough agricultural cycle and operational challenges.

Here's the quick math on the key valuation multiples:

• Price-to-Earnings (P/E): The P/E ratio is currently negative, around -82.0x, because the company reported negative trailing twelve-month (TTM) earnings per share (EPS) of approximately -$0.24. This means the company is not profitable on a TTM basis, making the P/E ratio uninformative for valuation.
• Price-to-Book (P/B): With a stock price of about $3.50 and a book value per share of $3.84, the P/B ratio is approximately 0.91x. A P/B below 1.0x suggests the stock is trading for less than the liquidation value of its net assets-a classic sign of potential undervaluation, especially for a real-estate-heavy company like BrasilAgro - Companhia Brasileira de Propriedades Agrícolas.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio is also not meaningful (NM) on a TTM basis. The TTM EBITDA margin was negative at -3.53%, though the Enterprise Value is substantial at $571.87 million. You need to look at forward-looking operational EBITDA, which for Q1 2026 was BRL64 million, to get a clearer operational picture.

The dividend story is mixed, which is typical for a company with lumpy land sales. The current dividend yield is attractive, sitting between 3.42% and 4.03%. The annual payout is around $0.12 to $0.14 per share. The payout ratio, however, is technically negative (-315.07%) when measured against net income due to the negative earnings. But, and this is crucial, the dividend payments are well-covered by cash flows, with a cash payout ratio of only 42.5%. This suggests the dividend is sustainable for now, supported by the proceeds from their core business of land development and sales.

Analyst consensus is cautious. While one model suggests the stock is trading at 67.8% below its fair value estimate, the overall technical sentiment is bearish, with some analysts marking it as a Strong Sell candidate as of November 2025. The market is clearly focused on the -39.16% decrease in 2025 fiscal year earnings to R$138.02 million, rather than the underlying value of the agricultural properties. The risk is that the market will continue to punish the stock until the agricultural cycle improves and operational results stabilize.

For a detailed look at the balance sheet and cash flow, check out the full post: Breaking Down BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) Financial Health: Key Insights for Investors

Risk Factors

You're looking for the unvarnished truth on BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND), and as a seasoned analyst, I can tell you the risks are real, but they are also manageable with the right strategy. The core challenge is navigating the volatile intersection of climate, commodities, and capital costs in Brazil. Your investment decision hinges on how well the company can mitigate these external pressures.

The biggest near-term headache is operational: the weather. Agricultural productivity is defintely exposed to uncontrollable climate factors like droughts and inconsistent rainfall. For the 2025/2026 harvest, the company itself cautioned that inconsistent rainfall could affect planting schedules and the second harvest. This is not a theoretical risk; it's a constant reality in agribusiness. For example, the sugarcane segment already faced challenges in the first quarter of fiscal year 2026 (reported November 2025) due to reduced productivity from adverse weather conditions.

Market and Operational Headwinds

The external market environment presents a double-whammy of commodity price volatility and rising input costs. The company's unique model-acquiring, developing, and selling farmland-means its operational farming segment is exposed to these swings. Honestly, farming margins are pretty bad right now, even if they are improving from a worse position last year.

• Commodity Price Exposure: Increased inventories mean greater exposure to price drops, plus the company saw a 14% decline in cotton prices in the Q1 2026 report.
• Rising Input Costs: Low crop prices combined with rising costs for fertilizers and other inputs squeeze the margin.
• Reliance on Land Sales: In fiscal year 2025, the company continued to post operational losses when excluding the profits from land sales. This means the core farming business isn't consistently profitable yet, making the non-recurring farm sales a crucial, but unpredictable, source of profit.

To be fair, management is taking clear action. They've implemented a robust hedging strategy to manage market and currency risks. As of May 7, 2025, BrasilAgro had hedged 72% of its soybean commodity exposure at R$/USD 10.88, and 83% of the associated exchange rate risk at R$/USD 5.41. That's smart risk management.

Financial and Strategic Risks

High interest rates in Brazil are a significant financial risk, directly impacting the cost of debt. The company's leverage increased to 2.7x in Q4 2025. Here's the quick math: the company's interest costs increased to R$82 million for the 2025 fiscal year, up from R$65 million the previous year, primarily due to higher interest rates and a nearly 50% year-over-year increase in net debt.

The net debt position is substantial, reported at BRL 785 million in Q4 2025, and later at BRL 895 million in the Q1 2026 report. However, this is partially offset by a significant amount of receivables from farm sales, which were over BRL 650 million in the Q1 2026 report. Still, high interest rates and currency fluctuations continue to pressure debt servicing.

The long-term strategic risk lies in the execution of their land development and sale model. The company needs to continue to successfully acquire, improve, and sell farms at a high Internal Rate of Return (IRR). Since 2020, they have sold BRL 1.9 billion ($346 million) in assets with an IRR of 9.3%.

The company's commitment to diversification and investment in technology is a clear mitigation plan. They are actively working to improve the operational side to reduce reliance on the cyclical nature of land sales. Understanding the Mission Statement, Vision, & Core Values of BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) can help you gauge their long-term commitment to these strategies.

Growth Opportunities

You're looking for a clear path through the volatility of the Brazilian agribusiness sector, and for BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND), that path is paved with land appreciation and operational efficiency. The core takeaway is that while the 2025 fiscal year (FY25) saw mixed results, the company's unique land-development model and strategic hedging position it for a strong operational rebound.

For FY2025, the company reported revenue of R$1.06 billion, a modest 3.73% increase over the previous year, but net earnings fell to R$138.02 million, a significant drop of 39.16% due to a challenging commodity price environment and lower farm sales compared to a blockbuster previous year. Still, the underlying operational machine is improving, with the first nine months of FY25 showing a net income turnaround to R$76.7 million from a net loss the year prior. One thing is defintely clear: land sales are the swing factor.

Key Growth Drivers: Land and Productivity

BrasilAgro's growth isn't just about selling crops; it's a real estate play. The company's primary growth driver is its unique model of acquiring underutilized land, developing it into highly productive agricultural properties using modern technology, and then strategically selling it at a substantial premium. Since 2020, this strategy has generated approximately R$1.9 billion in asset sales, demonstrating the value creation inherent in their process. This is the engine of their long-term value.

Operational improvements also drive near-term growth. For the 2024/2025 crop year, the company projected a 2% increase in total grain and cotton production compared to initial estimates, thanks to favorable weather and better practices. Key production estimates for the 2025 harvest include:

• Sugarcane: Estimated 2.3 million tons.
• Total Grain/Cotton: Expected 2% increase over original estimates.
• Planted Area: Maintaining a significant area of 172.6 thousand hectares for the 2025/2026 crop year.

Strategic Focus and Future Projections

The company's strategy for managing risk and driving future earnings is built on two pillars: diversification and financial engineering. They operate across Brazil, Paraguay, and Bolivia, growing a diverse mix of crops-soybean, corn, cotton, and sugarcane-which helps mitigate regional climate and commodity price risks. Analysts are bullish on the recovery, with some forecasting long-term annual earnings growth of nearly 49.7% and revenue growth of 18.5%, reflecting the expectation of a stronger commodity cycle and continued land sales.

Here's a quick look at the strategic initiatives that help stabilize their revenue streams:

• Commodity Hedging: As of May 2025, they had hedged 72% of their soybean commodity exposure, locking in prices to protect margins against market swings.
• Technological Investment: Continuous investment in genetically modified seeds, direct sowing, and crop rotation to boost Tons of Cane per Hectare (TCH) and overall productivity.
• Leasing: The recent leasing of 3,000 hectares in Mato Grosso reinforces their ability to expand cultivation area without a large upfront capital outlay for property acquisition.

For a deeper dive into who is betting on this model, you should check out Exploring BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (LND) Investor Profile: Who's Buying and Why?

Competitive Advantages and Market Position

BrasilAgro's main competitive advantage is its dual-revenue stream from agricultural operations and the strategic sale of appreciated farmland. This model is difficult to replicate at scale. Plus, their commitment to strong corporate governance-being the first Brazilian agribusiness company to list ADRs on the NYSE-gives them a transparency edge over many regional competitors.

Their extensive land portfolio, totaling over 273,486 thousand hectares of owned and leased farms, provides a massive, appreciating asset base. The table below summarizes the financial outlook based on the latest available 2025 fiscal year data and analyst consensus for future growth:

What this estimate hides is the inherent volatility of commodity prices and the Brazilian Real (BRL) exchange rate, which can significantly impact the final numbers despite the company's hedging efforts. Still, their land-rich balance sheet provides a solid floor for valuation.