Education
About Us
Working with TipRanks
Follow Us
Stoneco (STNE)
NASDAQ:STNE
Top Page
Stoneco
(NASDAQ:STNE)
Rating:56Neutral
Price Target:
$15.50
▼(-6.12% Downside)
Positive Factors
Capital management
The company has completed a substantial portion of its buyback program and has enough excess capital to potentially launch another program.
Financial performance
Management remains committed to deliver on its non-GAAP net income guidance, which implies a compound annual growth rate of 25%, and this potential is underappreciated by the market.
SCFI license utilization
The company's recent increased utilization of its SCFI license allows it to offer 'time deposits' to customers, which is seen as a long-term positive change.
Negative Factors
Impairment loss
Stone reported a net loss of R$2,922 million, due to the recognition of a R$3,558 million impairment loss for the software business unit.
Macroeconomic risk
There is a downside risk of the stock price reaching $10 in the event of a prolonged macroeconomic downturn.
Market pressure
Growth and profitability of merchant acquiring will likely come under significant pressure.
Stoneco (STNE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.42B
Dividend YieldN/A
Average Volume (3M)4.83M
Price to Earnings (P/E)8.7
Beta (1Y)1.35
Revenue Growth-20.82%
EPS Growth-154.29%
CountryUS
Employees7,239
SectorTechnology
Sector Strength84
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)0.43
Shares Outstanding254,617,000
10 Day Avg. Volume4,366,471
30 Day Avg. Volume4,831,086
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.36
Enterprise Value/Revenue0.45
Enterprise Value/Gross Profit0.60
Enterprise Value/Ebitda3.63
Forecast
1Y Price Target
$18.00Price Target Upside9.02% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
Stoneco Business Overview & Revenue Model
Company DescriptionStoneco (STNE) is a leading financial technology company based in Brazil, specializing in providing payment processing solutions and digital financial services to businesses of all sizes. The company operates primarily within the fintech sector, offering a range of products including payment processing, point-of-sale solutions, and digital banking services. Stoneco's platform enables merchants to accept various payment methods, manage transactions efficiently, and access credit options, thereby streamlining their financial operations.
How the Company Makes MoneyStoneco generates revenue primarily through transaction fees charged to merchants for processing payments. The company earns a percentage of each transaction processed through its platform, which constitutes a significant portion of its revenue stream. Additionally, Stoneco offers value-added services such as data analytics, financial management tools, and working capital loans, which also contribute to its earnings. The company has established partnerships with various financial institutions and payment networks, enhancing its service offerings and expanding its customer base. Furthermore, Stoneco's growth is supported by the increasing adoption of digital payments in Brazil and the broader Latin American market, positioning it favorably in a rapidly evolving fintech landscape.
Stoneco Key Performance Indicators (KPIs)
Any
Payments: Total TPV
Measures the total transaction volume processed, indicating the scale of Stoneco's payment operations and its market penetration.
Measures the total transaction volume processed, indicating the scale of Stoneco's payment operations and its market penetration.
Data provided by:
Main Street Data
Main Street DataStoneco Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 18, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong performance in financial metrics, strategic divestitures, and growth in banking services, but also highlights challenges such as slower TPV growth and increased provisions for credit losses amidst a challenging macroeconomic environment.Q2-2025 Updates
Positive Updates
Strong Adjusted Net Income Growth
Adjusted net income increased 27% year-over-year, reaching BRL 631 million, driven primarily by the financial services segment.
Effective Share Buyback Strategy
The company executed share buybacks totaling almost BRL 400 million during the quarter, contributing to a 45% year-over-year increase in adjusted basic EPS.
Successful Divestiture of Linx
StoneCo agreed to sell its Linx software business for an enterprise value of BRL 3.05 billion, with a total value unlocked of over BRL 4 billion.
Positive Banking Performance
Active banking client base grew 23% year-over-year, with client deposits up 36% year-over-year, highlighting strong banking segment growth.
Improved Revenue from Continuing Operations
Revenues from continuing operations grew 20% year-over-year to BRL 3.5 billion, driven by repricing initiatives and solid execution.
Negative Updates
Deceleration in TPV Growth
MSMB TPV grew only 12% year-over-year to BRL 122 billion, with a noted reduction in same-store sales due to a challenging macroeconomic environment.
Increased Provisions for Expected Losses
Provisions for expected losses rose significantly from BRL 34 million in the first quarter to BRL 82 million in the second quarter, driven by portfolio growth and a cautious macroeconomic outlook.
Higher Financial Expenses
Financial expenses increased 29% year-over-year, attributed to a higher average CDI rate despite mitigation efforts through client deposits.
Company Guidance
During StoneCo's second quarter 2025 earnings call, the company provided updated guidance reflecting its strategic focus on financial services following software divestitures. StoneCo revised its gross profit guidance to over 14.5% year-over-year growth, expecting it to surpass BRL 6.3 billion. The company also increased its expected EPS growth from 18% to 32% year-over-year, a 14-percentage-point upgrade, due to share buybacks and stronger-than-expected net income performance. The adjusted net income guidance was raised from BRL 2.4 billion to BRL 2.6 billion, highlighting confidence in operational execution. StoneCo emphasized its commitment to returning BRL 3 billion in excess capital generated in 2024 to shareholders, having already returned 41% through share buybacks. The divestiture of Linx and other software assets is expected to unlock over BRL 4 billion, roughly 25% of the company's market capitalization, with the proceeds aligned with capital allocation priorities.Stoneco Financial Statement Overview
Summary
Stoneco's financial performance is challenged by negative profitability metrics and cash flow issues, despite revenue growth. The increasing leverage and negative net income highlight potential risks in financial stability.Income Statement
Stoneco's income statement shows a mixed performance. The company has experienced revenue growth, with a notable increase in the TTM period. However, profitability metrics such as net profit margin and EBIT margin are concerning, with the company reporting negative net income in recent periods. This indicates challenges in cost management or operational efficiency.45
Neutral
Balance Sheet
The balance sheet reflects a moderate financial position. The debt-to-equity ratio has increased over time, indicating rising leverage, which could pose a risk if not managed carefully. Return on equity is negative, reflecting recent losses, but the equity ratio remains stable, suggesting a reasonable level of equity financing relative to total assets.50
Neutral
Cash Flow
Cash flow analysis reveals significant challenges, with negative free cash flow growth and a low operating cash flow to net income ratio. The company has struggled to convert its earnings into cash, which could impact its ability to invest in growth or service debt.40
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 13.47B | 12.74B | 11.36B | 9.02B | 4.58B | 3.18B |
| Gross Profit | 9.95B | 9.35B | 8.38B | 6.35B | 2.86B | 2.41B |
| EBITDA | 1.65B | 988.16M | 3.54B | 1.35B | -437.71M | 1.72B |
| Net Income | -1.27B | -1.52B | 1.59B | -519.42M | -1.36B | 854.07M |
Balance Sheet | ||||||
| Total Assets | 55.16B | 54.81B | 48.69B | 42.25B | 42.06B | 31.75B |
| Cash, Cash Equivalents and Short-Term Investments | 7.05B | 14.55B | 5.66B | 8.93B | 8.84B | 10.58B |
| Total Debt | 13.96B | 12.90B | 5.52B | 5.55B | 8.36B | 6.08B |
| Total Liabilities | 43.54B | 42.99B | 34.02B | 29.30B | 28.46B | 16.76B |
| Stockholders Equity | 11.57B | 11.78B | 14.62B | 12.89B | 13.51B | 14.85B |
Cash Flow | ||||||
| Free Cash Flow | -647.31M | -4.89B | 437.41M | 960.44M | 2.31B | -398.62M |
| Operating Cash Flow | 579.68M | -3.62B | 1.65B | 1.68B | 3.61B | 56.48M |
| Investing Cash Flow | -1.37B | 1.59B | -845.44M | -1.87B | -2.98B | -5.81B |
| Financing Cash Flow | 1.63B | 5.04B | -148.80M | -2.81B | 1.42B | 7.22B |
Stoneco Technical Analysis
Positive
16.51
Price Trends
14.89
Positive
14.24
Positive
11.83
Positive
Market Momentum
0.58
Negative
66.70
Neutral
80.89
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STNE, the sentiment is Positive. The current price of 16.51 is above the 20-day moving average (MA) of 15.43, above the 50-day MA of 14.89, and above the 200-day MA of 11.83, indicating a bullish trend. The MACD of 0.58 indicates Negative momentum. The RSI at 66.70 is Neutral, neither overbought nor oversold. The STOCH value of 80.89 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STNE.
Stoneco Risk Analysis
Stoneco disclosed 91 risk factors in its most recent earnings report. Stoneco 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 3 New Risks
1.
One of our founder shareholders holds a large amount of voting power over our common shares, and as a result has influence over certain of our activities and corporate decisions. Q4, 2022
2.
Any significant disruption to Linx's cloud hosting network infrastructure could damage its reputation, forcing it to provide credits or refunds, resulting in early termination of customer contracts or loss of customers, and adversely affect its business. Q4, 2022
3.
Links depends on telecommunications, internet and data center providers for its Software as a Service (SaaS), Cloud and on-premise infrastructure and any fluctuation or interruption in the provision of these services may impair the provision of services by Linx and affect its profitability. Q4, 2022
Stoneco Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $2.23B | 16.38 | 25.17% | 0.58% | 12.92% | 101.57% | |
75 Outperform | $2.43B | 25.67 | 13.86% | ― | 13.02% | -2.57% | |
73 Outperform | $4.05B | 33.45 | 30.92% | ― | 14.70% | -18.45% | |
73 Outperform | $2.97B | 7.25 | 14.59% | 1.49% | 0.09% | 5.38% | |
70 Outperform | $2.90B | 25.16 | -41.63% | ― | 13.29% | 79.98% | |
61 Neutral | $35.51B | 8.11 | -11.05% | 1.89% | 8.55% | -8.72% | |
56 Neutral | $4.42B | 8.73 | -8.77% | ― | -20.82% | -154.29% |
* Technology Sector Average
Performance Comparison
STNE
Stoneco
16.51
4.71
39.92%
EVTC
Evertec
34.60
2.83
8.91%
PAGS
Pagseguro Digital
9.26
-0.15
-1.59%
PAYO
Payoneer
6.70
-0.36
-5.10%
DOCN
DigitalOcean Holdings
32.12
-4.05
-11.20%
DLO
DLocal
12.84
4.66
56.97%
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.