Inter & Company Incorporation Class A (INTR) AI Stock Analysis

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Inter & Company Incorporation Class A

(NASDAQ:INTR)

Rating:70Neutral

Price Target:―

Inter & Co, Inc. demonstrates strong financial performance with notable revenue and profitability growth, yet faces liquidity challenges and moderate leverage. The stock's technical indicators show positive momentum, and the valuation is reasonable despite a low dividend yield. The recent earnings call was predominantly positive, showcasing significant achievements, although efficiency and capital adequacy remain areas for improvement. These factors collectively contribute to a moderately strong overall stock score.

Positive Factors

Competitive Advantages

Inter is optimistic about the private payroll loans opportunity, citing low cost of funding and fully digital distribution as competitive advantages.

Credit Growth

Management expects credit growth to accelerate to 25% to 30%.

Earnings Growth

EPS estimates for 2025 and 2026 have been updated to higher figures, indicating expected earnings growth.

Negative Factors

Customer Monetization

Stagnant customer monetization is a concern as Inter's average revenue per active customer has remained flat over the past three years.

Earnings Performance

The company delivered 1Q results that came in well below consensus with a 7% miss on net income.

Valuation Concerns

Valuation relative to profitability looks unattractive with shares trading above book value and expected ROE below the cost of capital.

Inter & Company Incorporation Class A (INTR) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$3.01B

Dividend Yield<0.01%

Average Volume (3M)2.29M

Price to Earnings (P/E)16.7

Beta (1Y)0.27

Revenue Growth17.46%

EPS Growth153.58%

CountryUS

Employees4,030

SectorFinancial

Sector Strength79

IndustryBanks - Regional

Share Statistics

EPS (TTM)0.11

Shares Outstanding322,639,600

10 Day Avg. Volume1,792,757

30 Day Avg. Volume2,291,938

Financial Highlights & Ratios

PEG Ratio3.11

Price to Book (P/B)0.72

Price to Sales (P/S)0.00

P/FCF Ratio2.58

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$4.00

Price Target Upside-44.83% Downside

Rating ConsensusModerate Sell

Number of Analyst Covering1

Inter & Company Incorporation Class A Business Overview & Revenue Model

Company DescriptionInter & Co, Inc., through its subsidiaries, engages in the banking, securities, insurance brokerage, marketplace, asset management, and services businesses. The company's Banking segment offers banking products and services, including checking accounts, cards, deposits, loans and advances, and other services. Its Securities segment provides services relating to the purchase, sale, and custody of securities; and portfolio management, as well as the establishment, organization, and management of investment funds. The company's Insurance Brokerage segment offers life, property, auto, financial, lost or stolen credit card, dental, warranties, travel, and credit protection insurance products. Its Marketplace segment operates a digital platform that offer goods and/or services to its customers. The company's Asset Management segment is involved in the operations related to the management of fund portfolios and other assets. Its Services segment provides services in the collection and management of personal information; development and licensing of customized and non-customized computer programs; and technical support, maintenance, and other information technology services. The company was founded in 1994 and is based in Belo Horizonte, Brazil.

How the Company Makes MoneyInter & Company Incorporation makes money through various revenue streams, primarily driven by its digital banking platform. Key revenue sources include interest income from loans and credit products, fees from banking transactions, and service charges from investment products. Additionally, the company generates revenue from partnerships with other financial institutions and service providers that leverage its platform for additional services. Its digital-first approach and extensive use of technology enable it to operate with lower costs, thus enhancing its profitability.

Inter & Company Incorporation Class A Earnings Call Summary

Earnings Call Date:May 12, 2025

(Q4-2024)

% Change Since: 1.97%|

Next Earnings Date:Aug 18, 2025

Earnings Call Sentiment Positive

The earnings call was predominantly positive, with strong growth in net income, client acquisition, and various business segments. Global expansion and product innovation were highlighted as significant achievements. However, challenges in improving the efficiency ratio and capital ratio were noted, though they did not significantly detract from the overall positive sentiment of the call.

Q4-2024 Updates

Positive Updates

Record Net Income for 2024

2024 net income was more than the company's prior years combined, showcasing the success of their business model and profitability.

Significant Client Growth

The company added over four million clients in 2024, finishing the year with over 36 million clients and a 57% activation rate.

Strong Performance in Banking and TPV

TPV increased by 45% year over year, reaching a 1.5 trillion reais run rate in 4Q24. Inter & Co gained 14 basis points in PIX market share, reaching 8.3%.

Record Growth in Insurance and Marketplace

Insurance vertical achieved a 312% growth in active contracts, and the marketplace saw a 79% year-over-year growth in net revenues.

Global Expansion Milestone

The global account reached 3.9 million clients, with a 52% increase in deposit balance over the year.

Negative Updates

Slight Efficiency Ratio Improvement

Despite a slight improvement, expense growth remained elevated, affecting the efficiency ratio and progress towards the 30% long-term target.

Core Tier One Ratio Concerns

The core Tier one ratio decreased to 15.2%, raising questions about capital adequacy despite excess capital at the holding level.

Company Guidance

In the fourth quarter of 2024, Inter & Co, Inc. delivered significant financial achievements, surpassing all prior years' combined net income. With an impressive annual net income of 973 million reais, the company achieved a 33% year-over-year growth in loan portfolios, with standout performances in FGTS and home equity products, each growing over 50%. They also reported a total gross revenue exceeding 10 billion reais and a net revenue of 6.4 billion reais, with a notable 37% increase in net interest income (NII) and a 31% rise in net fees. Customer growth was robust, with over 36 million clients and a 57% activation rate, contributing to a total payment volume (TPV) increase of 45% year-over-year, reaching a 1.5 trillion reais run rate. The company's NIM expanded significantly, and the cost of risk stabilized at 5.0%, reflecting improved asset quality metrics. Inter & Co, Inc. also celebrated a strong ROE of 11.7% and maintained a cost of funding at 64% of CDI. Additionally, they expanded their global client base to 3.9 million and enhanced their marketplace, achieving a 79% year-over-year growth in net revenues.

Inter & Company Incorporation Class A Financial Statement Overview

Summary

Inter & Co, Inc. is experiencing significant revenue growth and improving profitability margins, with a strong income statement score due to increased net profit margins and operational efficiency. However, the balance sheet indicates moderate leverage and room for improvement in ROE, while cash flow challenges suggest potential liquidity issues, affecting the overall financial performance.

Income Statement

Positive

Inter & Company Incorporation has shown strong revenue growth over recent years, with a notable increase from $1.14 billion in 2020 to $4.60 billion in 2024. The gross profit margin remains robust at 100%, as is typical in the banking sector, and the net profit margin has improved significantly, reaching 19.71% in 2024. However, the EBIT margin has shown volatility, with a recent increase to 37.7% in 2024, indicating improved operational efficiency. The absence of EBITDA data limits a full assessment of operating performance.

Balance Sheet

Neutral

The company's balance sheet shows moderate leverage with a debt-to-equity ratio of 0.39 in 2024, down from previous years, which indicates improved financial stability. The equity ratio stands at 11.63% in 2024, reflecting a conservative capital structure. However, the return on equity of 10.2% in 2024 signals moderate profitability relative to shareholders' equity, suggesting room for improvement in generating returns from equity capital.

Cash Flow

Neutral

Inter & Company Incorporation's cash flow analysis reveals challenges with negative free cash flow growth, declining from $1.95 billion in 2023 to -$6.47 billion in 2024, indicating potential liquidity issues. The operating cash flow to net income ratio is negative, highlighting operational cash flow concerns. While the financing cash flow remains positive, driven by substantial cash inflows, reliance on external financing could pose risks if not managed carefully.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
4.60B	3.21B	3.56B	2.58B	1.14B
	Gross Profit
4.60B	3.21B	3.56B	2.58B	1.14B
	EBIT
1.73B	798.47M	1.80B	-58.98M	-61.86M
	EBITDA
0.00	0.00	0.00	0.00	0.00
	Net Income Common Stockholders
907.13M	302.34M	-14.08M	64.70M	5.58M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
983.20M	4.26B	17.55B	16.09B	9.68B
	Total Assets
76.46B	60.35B	46.34B	36.48B	19.80B
	Total Debt
3.48B	8.32B	6.39B	3.60B	1.76B
	Net Debt
2.50B	2.04B	-1.46B	-1.36B	-2.64B
	Total Liabilities
67.39B	52.76B	39.25B	3.65B	16.45B
	Stockholders Equity
8.90B	7.47B	6.99B	8.49B	3.30B
Cash Flow		Free Cash Flow
-6.47B	1.95B	1.95B	-147.56M	2.41B
	Operating Cash Flow
-6.39B	2.22B	2.24B	167.52M	2.61B
	Investing Cash Flow
-7.73B	-4.67B	-187.65M	-7.19B	-4.65B
	Financing Cash Flow
10.83B	8.97B	4.09B	5.35B	1.11B

Inter & Company Incorporation Class A Technical Analysis

Technical Analysis Sentiment

Positive

Last Price7.25

Price Trends

50DMA

6.47

Positive

100DMA

5.90

Positive

200DMA

5.85

Positive

Market Momentum

MACD

0.12

Positive

RSI

61.51

Neutral

STOCH

43.08

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INTR, the sentiment is Positive. The current price of 7.25 is above the 20-day moving average (MA) of 7.02, above the 50-day MA of 6.47, and above the 200-day MA of 5.85, indicating a bullish trend. The MACD of 0.12 indicates Positive momentum. The RSI at 61.51 is Neutral, neither overbought nor oversold. The STOCH value of 43.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for INTR.

Inter & Company Incorporation Class A Risk Analysis

Inter & Company Incorporation Class A disclosed 73 risk factors in its most recent earnings report. Inter & Company Incorporation Class A reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Inter & Company Incorporation Class A Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FFBC	75 Outperform	$2.34B	10.16	9.58%	3.93%	8.05%	-3.31%
FRME	75 Outperform	$2.20B	10.64	9.16%	3.81%	1.42%	2.77%
WAFD	71 Outperform	$2.35B	11.13	7.70%	3.68%	24.53%	0.16%
INTR	70 Neutral	$3.01B	16.68	11.11%	<0.01%	17.46%	153.58%
PFS	68 Neutral	$2.23B	15.40	6.77%	5.62%	80.24%	-30.60%
Sector *	64 Neutral	$12.85B	9.81	7.79%	78.20%	12.23%	-7.93%
BANC	61 Neutral	$2.25B	21.95	4.33%	2.80%	121.04%	―

* Financial Sector Average

Performance Comparison

INTR

Inter & Company Incorporation Class A

7.25

1.70

30.63%

FFBC

First Financial Bancorp

24.03

3.73

18.37%

FRME

First Merchants

37.32

7.04

23.25%

BANC

Banc of California

14.11

1.37

10.75%

PFS

Provident Financial Services

17.08

4.29

33.54%

WAFD

Washington Federal

29.10

3.42

13.32%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.