Inter & Company Inc. Class A: Sell Rating Due to Financial Underperformance and Valuation Concerns

In a report released yesterday, Jorge Kuri from Morgan Stanley maintained a Sell rating on Inter & Company Incorporation Class A (INTR – Research Report), with a price target of $4.00.

Jorge Kuri has given his Sell rating due to a combination of factors that highlight concerns about Inter & Company Incorporation Class A’s financial performance and valuation. The company’s first-quarter results for 2025 fell short of expectations, with net income and pre-tax income missing consensus estimates by 7% and 10%, respectively. This underperformance is largely attributed to weak customer monetization, as evidenced by a modest increase in gross ARPAC and a decline in net ARPAC.
Furthermore, the company’s cost structure remains a concern, with expenses growing faster than net revenue on a year-over-year basis, suggesting limited potential for further efficiency improvements. Despite some positive developments in loan growth and asset quality, the overall return on equity remains below the cost of equity, leading to a perception of excessive valuation. These factors collectively underpin Kuri’s Sell rating, reflecting skepticism about the company’s ability to achieve sustainable financial growth and justify its current market valuation.