StoneCo (NASDAQ:STNE) Shares Down 5% - What's Next?

Key Points

• StoneCo shares fell 5% to about $9.72, with trading volume 58% below the average session volume.
• Analyst sentiment is mixed but leans toward “Hold”: four analysts rate the stock a Buy and six rate it a Hold, with an average price target of $14.59.
• StoneCo slightly exceeded quarterly EPS expectations, reporting $0.47 versus the $0.46 consensus estimate, while institutional investors own a substantial 73.19% of the company.

Shares of StoneCo Ltd. (NASDAQ:STNE - Get Free Report) fell 5% during mid-day trading on Friday . The company traded as low as $9.47 and last traded at $9.7180. 2,174,293 shares traded hands during trading, a decline of 58% from the average session volume of 5,136,240 shares. The stock had previously closed at $10.23.

Wall Street Analysts Forecast Growth

A number of equities analysts recently commented on STNE shares. Jefferies Financial Group assumed coverage on StoneCo in a report on Thursday, July 23rd. They issued a "hold" rating and a $12.60 target price on the stock. Citigroup cut StoneCo from a "buy" rating to a "neutral" rating and reduced their price target for the stock from $18.00 to $11.00 in a research report on Friday, May 15th. BTIG Research reduced their price target on StoneCo from $22.00 to $15.00 and set a "buy" rating for the company in a research report on Friday, May 15th. UBS Group decreased their price objective on StoneCo from $17.00 to $15.00 and set a "buy" rating on the stock in a research note on Friday, July 17th. Finally, Weiss Ratings cut StoneCo from a "hold (c)" rating to a "hold (c-)" rating in a research report on Thursday, June 18th. Four equities research analysts have rated the stock with a Buy rating and six have given a Hold rating to the company. Based on data from MarketBeat, the company has an average rating of "Hold" and an average price target of $14.59.

StoneCo Trading Down 6.2%

The stock has a market capitalization of $2.39 billion, a PE ratio of 3.84, a PEG ratio of 0.29 and a beta of 1.74. The stock's 50 day moving average price is $10.91 and its 200-day moving average price is $12.89. The company has a quick ratio of 1.33, a current ratio of 1.33 and a debt-to-equity ratio of 0.57.

StoneCo (NASDAQ:STNE - Get Free Report) last issued its earnings results on Thursday, August 13th. The company reported $0.47 earnings per share for the quarter, topping the consensus estimate of $0.46 by $0.01. The company had revenue of $129.73 million during the quarter, compared to the consensus estimate of $708.24 million. StoneCo had a net margin of 23.82% and a return on equity of 21.05%. On average, sell-side analysts expect that StoneCo Ltd. will post 2.27 earnings per share for the current fiscal year.

Insider Buying and Selling at StoneCo

In other news, Director Silvio Jose Morais sold 9,000 shares of the company's stock in a transaction dated Friday, June 12th. The stock was sold at an average price of $11.29, for a total value of $101,610.00. Following the completion of the transaction, the director owned 21,000 shares of the company's stock, valued at $237,090. This represents a 30.00% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. 11.25% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

A number of large investors have recently added to or reduced their stakes in the business. SPX Gestao de Recursos Ltda grew its holdings in StoneCo by 47.6% during the 1st quarter. SPX Gestao de Recursos Ltda now owns 7,728,014 shares of the company's stock valued at $109,120,000 after buying an additional 2,491,394 shares in the last quarter. State Street Corp lifted its holdings in shares of StoneCo by 23.0% in the fourth quarter. State Street Corp now owns 7,714,651 shares of the company's stock worth $114,101,000 after buying an additional 1,440,760 shares in the last quarter. BRC Global BAH Investments Ltd. lifted its holdings in shares of StoneCo by 32.7% in the first quarter. BRC Global BAH Investments Ltd. now owns 7,580,409 shares of the company's stock worth $107,035,000 after buying an additional 1,867,018 shares in the last quarter. Squadra Investments Gestao DE Recursos LTDA. boosted its position in shares of StoneCo by 435.5% during the first quarter. Squadra Investments Gestao DE Recursos LTDA. now owns 6,662,253 shares of the company's stock worth $94,071,000 after acquiring an additional 5,418,053 shares during the last quarter. Finally, Bank of America Corp DE boosted its position in shares of StoneCo by 151.7% during the first quarter. Bank of America Corp DE now owns 6,032,572 shares of the company's stock worth $85,180,000 after acquiring an additional 3,636,276 shares during the last quarter. 73.19% of the stock is owned by hedge funds and other institutional investors.

About StoneCo

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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