, an analyst from Citi, has initiated a new Buy rating on DLocal (DLO).
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Citigroup’s rating is based on several compelling factors that highlight DLocal’s potential for growth and shareholder returns. The company is a leading cross-border payment platform that focuses on emerging markets, which are less saturated compared to developed markets. This strategic positioning allows DLocal to be a preferred choice for merchants looking to expand in these regions. Additionally, DLocal’s announcement of a dividend policy to distribute 30% of free cash flow annually starting in 2026 is expected to enhance shareholder value.
Furthermore, Citigroup acknowledges DLocal’s strong investment thesis, which includes the company’s rapid total payment volume expansion, sustained foreign exchange spreads, and operating leverage. The company’s scalable technology and asset-light business model add to its appeal, alongside an attractive valuation compared to historical trading levels. New management is also seen as a positive change, bringing increased credibility and potential future growth opportunities, such as Buy Now, Pay Later (BNPL) services, which could further drive value, although these are not included in the base case valuation.
In another report released on May 15, Susquehanna also maintained a Buy rating on the stock with a $18.00 price target.