Stoneco (STNE) AI Stock Analysis

• Market Cap: $3.84B
• Dividend Yield: N/A
• Average Volume (3M): 8.23M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.30
• Revenue Growth: -25.51%
• EPS Growth: -139.31%
• Country: US
• Employees: 7,239
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.47
• Shares Outstanding: 254,617,000
• 10 Day Avg. Volume: 5,901,741
• 30 Day Avg. Volume: 8,230,580
• PEG Ratio: 0.05
• Price to Book (P/B): 1.27
• Price to Sales (P/S): 1.17
• P/FCF Ratio: -3.05
• Enterprise Value/Market Cap: 9.87
• Enterprise Value/Revenue: 2.80
• Enterprise Value/Gross Profit: 3.72
• Enterprise Value/Ebitda: 4.96
• 1Y Price Target: $20.50
• Price Target Upside: 21.66% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 1.62
• Revenue Forecast (FY): $2.60B

• Rating: 51 Neutral
• Price Target: $17.00 ▲(0.89% Upside)

Stoneco's overall stock score reflects its financial challenges, particularly in profitability and cash flow, which are significant concerns. While technical indicators suggest some bearish momentum, the earnings call provides a cautiously optimistic outlook with strong EPS growth and capital returns. However, valuation remains a key risk due to the negative P/E ratio.

Positive Factors

Revenue and Income Growth

The 16% YoY revenue growth indicates strong business expansion and effective client monetization, enhancing long-term market position.

Banking Operation Expansion

The 22% increase in active clients and 32% rise in deposits strengthen Stoneco's market presence and financial service capabilities.

Consistent Capital Returns

Significant capital returns demonstrate strong cash generation and commitment to shareholder value, supporting long-term investor confidence.

Negative Factors

Rising Financial Expenses

The 28% increase in financial expenses can pressure margins and reduce profitability, posing a risk to long-term financial health.

Rising NPLs

Increasing NPLs indicate potential credit risk and portfolio quality issues, which could impact future earnings and financial stability.

Increased Leverage

Higher leverage with a 1.38 debt-to-equity ratio increases financial risk, potentially limiting flexibility and affecting long-term stability.

Stoneco Business Overview & Revenue Model

Company Description

Stoneco (STNE) is a Brazilian financial technology company that provides payment processing solutions, digital banking services, and software for businesses of all sizes. Founded in 2012, Stoneco primarily serves the Brazilian market and operates in the fintech sector, focusing on enabling merchants to accept electronic payments through various channels such as credit cards, debit cards, and mobile payments. The company's core offerings include point-of-sale (POS) systems, payment gateways, and financial management tools, supporting both physical and online retail operations.

How the Company Makes Money

Stoneco generates revenue primarily through transaction fees charged to merchants for processing payments. The company earns a percentage of each transaction processed, which varies based on the payment method and volume. Additionally, Stoneco offers value-added services such as lending, which provides credit solutions to small and medium-sized enterprises (SMEs), further diversifying its revenue streams. The company has established partnerships with various financial institutions and technology providers to enhance its service offerings and expand its customer base. These collaborations allow Stoneco to integrate additional financial products, contributing to its overall earnings.

Stoneco Financial Statement Overview

Summary

Stoneco demonstrates revenue growth and strong gross profit margins, but faces significant profitability and cash flow challenges. The increasing leverage and negative return on equity pose risks to financial stability.

Income Statement

Stoneco's revenue has shown consistent growth, with a TTM increase of 2.62%. However, the company struggles with profitability, as evidenced by a negative net profit margin of -8.29% in the TTM. The gross profit margin remains strong at 74.82%, indicating efficient cost management. Despite this, the negative EBIT and EBITDA margins in previous years highlight ongoing operational challenges.

Balance Sheet

The company's debt-to-equity ratio has increased to 1.38 in the TTM, indicating higher leverage and potential risk. The return on equity is negative at -9.86%, reflecting the company's inability to generate profit from shareholders' equity. However, the equity ratio remains stable, suggesting a balanced asset structure.

Cash Flow

Stoneco's cash flow situation is concerning, with negative operating cash flow and free cash flow in the TTM. The free cash flow growth rate is positive at 119.05%, but this is due to a low base effect. The operating cash flow to net income ratio is negative, indicating cash flow issues relative to earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	13.52B	12.74B	11.36B	9.02B	4.58B	3.17B
Gross Profit	10.19B	9.35B	8.38B	6.35B	2.86B	2.40B
EBITDA	7.65B	6.41B	5.87B	4.21B	1.36B	1.59B
Net Income	-1.14B	-1.52B	1.59B	-519.42M	-1.36B	854.07M
Balance Sheet
Total Assets	58.60B	54.81B	48.69B	42.25B	42.10B	31.75B
Cash, Cash Equivalents and Short-Term Investments	7.53B	14.55B	12.06B	8.93B	8.84B	11.29B
Total Debt	16.16B	12.90B	5.52B	5.55B	8.36B	6.08B
Total Liabilities	46.81B	42.99B	34.02B	29.30B	28.47B	16.76B
Stockholders Equity	11.75B	11.78B	14.62B	12.89B	13.54B	14.85B
Cash Flow
Free Cash Flow	-1.42B	-4.89B	437.41M	960.44M	2.31B	-398.62M
Operating Cash Flow	-334.38M	-3.62B	1.65B	1.68B	3.61B	56.48M
Investing Cash Flow	-1.18B	1.59B	-845.44M	-1.87B	-2.98B	-5.81B
Financing Cash Flow	3.33B	5.04B	-148.80M	-2.81B	1.42B	7.22B

Stoneco Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 16.85
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STNE, the sentiment is Negative. The current price of 16.85 is above the 20-day moving average (MA) of 15.29, above the 50-day MA of 16.72, and above the 200-day MA of 14.99, indicating a bearish trend. The MACD of -0.63 indicates Negative momentum. The RSI at 42.49 is Neutral, neither overbought nor oversold. The STOCH value of 21.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STNE.

Stoneco Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PAGS	80 Outperform	$3.19B	7.55	14.28%	1.41%	0.58%	5.76%
DLO	73 Outperform	$4.23B	28.11	32.78%	―	22.02%	12.42%
PATH	72 Outperform	$8.93B	37.64	12.56%	―	10.05%	―
FOUR	69 Neutral	$5.76B	30.41	15.52%	―	23.16%	27.38%
PAYO	69 Neutral	$2.06B	29.31	9.79%	―	10.58%	-45.52%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
STNE	51 Neutral	$3.84B	-28.75	-7.53%	―	-25.51%	-139.31%

Stoneco Corporate Events

StoneCo Launches New R$2 Billion Share Buyback After Fully Distributing 2024 Excess Capital

On December 22, 2025, StoneCo announced that its board had approved a new share repurchase program, authorized on December 18, 2025, allowing the company to buy back up to R$2 billion of its outstanding Class A common shares with no set expiration date, replacing a prior program under which it had repurchased 21,872,021 shares at an average price of US$16.34 per share for a total of R$1.95 billion. The company also confirmed it has now fully distributed the R$3 billion in excess capital generated from its 2024 results through share buybacks, underscoring its commitment to returning surplus capital to shareholders when it lacks immediate value-accretive investment opportunities, and said it will update investors on excess capital from 2025 results in its upcoming fourth-quarter 2025 earnings release.

StoneCo Releases Q3 2025 Financial Statements Highlighting Discontinued Operations

StoneCo Ltd. released its unaudited interim condensed consolidated financial statements for the period ending September 30, 2025. The report highlights the company’s financial position, including assets classified as held for sale due to discontinued operations in the second quarter of 2025. The financial statements, reviewed by Ernst & Young, indicate no significant issues, affirming a fair view of the company’s financial status. This development may impact StoneCo’s strategic positioning as it adjusts its asset portfolio, potentially affecting stakeholders’ interests.

StoneCo Reports Strong Third Quarter 2025 Financial Results

StoneCo Ltd. reported its financial results for the third quarter of 2025, showing a significant increase in revenue and profitability. The company’s total revenue and income from continuing operations reached R$3,566.8 million, marking a 16.5% year-over-year increase, driven by stronger client monetization and an expanding client base. Adjusted gross profit grew by 11.7% year-over-year to R$1,604.9 million, despite higher financial expenses due to increased CDI rates. The company’s strategic repricing initiatives and growth in its loan portfolio contributed to these positive results, although they faced challenges from increased financial expenses and provisions for credit.