StoneCo (NASDAQ:STNE) Trading Up 4.7% - Still a Buy?

Key Points

• StoneCo shares rose 4.7% to about $10.29 in mid-day trading, though volume was roughly 85% below the daily average.
• Analyst sentiment remains mixed: the stock has a consensus “Hold” rating and a $14.30 average price target, with some firms cutting targets while UBS maintained a “Buy” rating.
• StoneCo slightly exceeded quarterly EPS expectations, reporting $0.47 versus the $0.46 consensus estimate, while institutional investors own 73.19% of the company and an insider recently sold 21,000 shares.

StoneCo Ltd. (NASDAQ:STNE - Get Free Report)'s share price rose 4.7% during mid-day trading on Thursday . The company traded as high as $10.21 and last traded at $10.2850. Approximately 826,573 shares changed hands during trading, a decline of 85% from the average daily volume of 5,337,556 shares. The stock had previously closed at $9.82.

Analyst Ratings Changes

Several equities research analysts have recently commented on STNE shares. JPMorgan Chase & Co. dropped their target price on shares of StoneCo from $20.00 to $16.50 and set an "overweight" rating for the company in a research report on Wednesday, May 27th. Weiss Ratings downgraded shares of StoneCo from a "hold (c)" rating to a "hold (c-)" rating in a research note on Thursday, June 18th. UBS Group cut their price objective on StoneCo from $15.00 to $13.00 and set a "buy" rating on the stock in a research report on Friday, August 28th. Jefferies Financial Group assumed coverage on StoneCo in a report on Thursday, July 23rd. They set a "hold" rating and a $12.60 target price on the stock. Finally, Bank of America lowered StoneCo from a "buy" rating to a "neutral" rating and set a $13.00 target price for the company. in a research report on Wednesday, July 15th. Four analysts have rated the stock with a Buy rating and six have given a Hold rating to the company's stock. According to MarketBeat, StoneCo presently has a consensus rating of "Hold" and a consensus target price of $14.30.

StoneCo Stock Up 5.1%

The stock's 50-day moving average price is $10.49 and its two-hundred day moving average price is $11.94. The stock has a market capitalization of $2.57 billion, a PE ratio of 4.15, a P/E/G ratio of 0.29 and a beta of 1.75. The company has a debt-to-equity ratio of 0.84, a quick ratio of 1.26 and a current ratio of 1.26.

StoneCo (NASDAQ:STNE - Get Free Report) last issued its quarterly earnings results on Thursday, August 13th. The company reported $0.47 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.46 by $0.01. StoneCo had a net margin of 22.92% and a return on equity of 22.19%. The company had revenue of $129.73 million during the quarter, compared to analysts' expectations of $708.24 million. As a group, analysts expect that StoneCo Ltd. will post 2.3 EPS for the current fiscal year.

Insider Activity

In related news, Director Silvio Morais sold 21,000 shares of the company's stock in a transaction that occurred on Wednesday, September 2nd. The stock was sold at an average price of $9.91, for a total value of $208,110.00. The transaction was disclosed in a filing with the SEC, which is accessible through this hyperlink. Insiders own 11.25% of the company's stock.

Institutional Inflows and Outflows

A number of large investors have recently added to or reduced their stakes in the stock. AQR Capital Management LLC purchased a new stake in shares of StoneCo in the first quarter worth $902,000. Strs Ohio purchased a new position in shares of StoneCo in the 1st quarter worth about $70,000. Prudential Financial Inc. boosted its stake in StoneCo by 37.4% in the 2nd quarter. Prudential Financial Inc. now owns 28,075 shares of the company's stock worth $450,000 after purchasing an additional 7,635 shares in the last quarter. Invesco Ltd. boosted its stake in StoneCo by 8.3% in the 2nd quarter. Invesco Ltd. now owns 256,142 shares of the company's stock worth $4,109,000 after purchasing an additional 19,723 shares in the last quarter. Finally, First Trust Advisors LP grew its position in StoneCo by 10.0% during the 2nd quarter. First Trust Advisors LP now owns 13,995 shares of the company's stock valued at $224,000 after purchasing an additional 1,273 shares during the last quarter. Hedge funds and other institutional investors own 73.19% of the company's stock.

StoneCo Company Profile

StoneCo Ltd., commonly known as Stone, is a Brazilian financial technology company that provides integrated digital payment solutions and related financial services to merchants. Through its cloud-based platform, Stone enables businesses of all sizes to accept a variety of payment methods, including point-of-sale (POS) terminals, mobile card readers and e-commerce gateways. In addition to payment acceptance, the company offers value-added services such as working capital loans, digital banking products and automated billing tools designed to help merchants manage cash flow and streamline operations.

Since its founding in 2012 by André Street and Eduardo Pontes, Stone has focused on serving over half a million merchants across Brazil's retail, restaurant and services sectors.

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