JBS is handing its top job to a 34-year-old who already runs its US business. Wesley Batista Filho will replace CEO Gilberto Tomazoni in January.
"We're going to continue to grow on the avenues that we have been growing," he said, signaling the strategy will not change.
The market did not cheer. The slide followed the company's late-Monday disclosure of a second-quarter net loss tied to one-time charges, plus the leadership news.
XP Inc. analysts said the timing of the announcements was "far from obvious" and warned the change could bring back "negative memories of governance issues in JBS."
BTG Pactual analysts were calmer. They said the transition had been in preparation for years, adding, "We've always sensed he was being prepared to take over."
The core issue is simple: not enough cows. US meatpackers are paying high prices for a tight supply of cattle, and a more-than-yearlong ban on Mexican cattle imports made the shortage worse.
The ban was imposed over New World screwworm, a deadly parasite, and the reopening is meant to bring down record beef prices. The Trump administration said last month it would resume Mexican cattle imports.
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The shortage helped push beef prices to records, which is why the border closure mattered in the first place. With imports resuming, the hope is that more cattle will ease the squeeze.
But JBS's main US beef business has not yet benefited from its restructuring. The unit improved only modestly in the latest quarter.
The company still expects the restructuring, along with restored cattle flows from Mexico, to help meatpacking margins. Some meatpackers have closed plants to reduce competition for cattle and support margins.
JBS said it will convert its idled plant in Souderton, Pennsylvania, to make value-added products.
"It's going to be much better than where we are right now," he told analysts.
JBS is targeting US operating profit margins 2.5 percentage points above rivals by 2027. But the incoming CEO acknowledged that rebuilding the herd could take no less than a couple of years.
BTG Pactual analysts said JBS "seems more optimistic than its peers about the benefits of reopening cattle imports from Mexico." They called the future of US beef operations "the most important variable to watch."
They also said the leadership handoff should go smoothly. "We do sense that this is to be a smooth process," they wrote.
For investors, the JBS story is a reminder that turnarounds take time. The company is betting that cattle supplies recover, margins climb, and the US beef business eventually delivers.
If you own JBS shares, the company's message is clear: the payoff is a ways off. The new CEO is pointing to 2027 as the moment when cattle flows return to normal and margins climb.
JBS is not alone in this squeeze. The whole US meatpacking industry is dealing with high costs and tight cattle supplies.
The stock's two-day slide is the market's way of saying it wants proof. For shareholders, the next few quarters will tell the real story.
But the family's return to the top role is giving some investors pause. If cattle flows return and margins start climbing, the recent slide will look like a blip.
If not, the wait just gets longer.
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