Ultrapar Participações S.A. (UGP) Stock Analysis & Winston Score

Ultrapar Participações is a Brazilian conglomerate focused mainly on fuel distribution and specialty chemicals. Its largest business, Ipiranga, is one of Brazil's biggest fuel distribution networks, selling gasoline, diesel, and ethanol to drivers and businesses through thousands of gas stations across the country. It also operates Ultragaz, a major distributor of liquefied petroleum gas (LPG) to homes and businesses, and Ultracargo, a liquid bulk storage terminal business.

Ultrapar earns most of its revenue by buying fuel and gas in bulk and reselling it through its distribution networks, making money on the margin between purchase and sale prices. The company operates almost entirely in Brazil, making it closely tied to the health of the Brazilian economy and currency. Its large, established distribution network and well-known brands give it a competitive edge, but thin margins — typical in fuel distribution — mean that rising oil prices or economic downturns in Brazil can quickly squeeze profitability. Expanding its retail fuel network and growing Ultracargo's storage capacity are key near-term growth drivers.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+10.3% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

+163.3% YoY

YoY Growth Rate

EPS growth accelerating

Insider Activity

0.0%ownership

Relatively low insider ownership

Cash Position

Cash flow positive

$2.5B cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Company generates more cash than it spends — no dilution risk from fundraising

Growth + cash flow

Ultrapar Participações S.A. is a rare growth stock that's already generating positive cash flow while growing at 10%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

8.6%

Thin — 8.6% gross margin

Operating Margin

5.0%

Thin — 5.0% operating margin

ROCE

25.1%

Exceptional — 25.1% return on capital

ROIC above 25%. Every dollar invested in the business earns more than 25 cents back per year.

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Growth

Sales YoY

+6.9%

Slow sales growth (6.9% YoY)

EPS YoY

+34.3%

Earnings growing fast (34.3% YoY)

Earnings growing 25%+ a year. The compounder zone.

EPS Consistency

6/8 quarters

Earnings grew in most of the last 8 quarters

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Cash Flow

Cash Conversion

117%

Turns 117% of profit into real cash

FCF Margin

1.3%

Thin free cash flow (1.3%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity

1.20

Elevated debt (1.20)

Interest Cover

2.01x

Tight — interest eats into profit (2.0x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

P/E Ratio (TTM)

2.2x

no trend

Attractive valuation — P/E 2.2

P/E under 10. The price tag is small relative to last year's profit.

P/E vs Forward

+0.4

GROWING

Earnings roughly flat

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Dividends

Dividend Yield

4.20%

no trend

Healthy income — 4.20% yield

Generous yield. Worth checking whether the payout is sustainable.

Dividend Growth

+56.2%

no trend

Dividend growing fast (56.2% YoY)

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