Shares of Copel (CPLE3) fell 3% in Thursday trading after the Brazilian utility announced a revision to its capital structure policy, raising its target financial leverage ratio.
The move marks a strategic pivot for the company, which had previously maintained a more conservative balance sheet posture.
Investors reacted negatively to the prospect of higher debt levels, which could constrain future cash flow flexibility.
JPMorgan analysts expressed caution regarding the implications for shareholder returns, specifically highlighting potential risks to the company's dividend policy.
The broker's commentary suggests that the increased leverage target may limit the amount of free cash flow available for distributions, a key metric for income-focused investors in the Brazilian utility sector.
This marks a departure from the stable payout expectations that have underpinned the stock's valuation in recent quarters.