BTIG Starts StoneCo Ltd. (STNE) at Buy

BTIG analyst Andrew Harte initiates coverage on StoneCo Ltd. (NASDAQ: STNE) with a Buy rating and a price target of $22.00.

The analyst comments "We are initiating coverage of StoneCo (STNE) with a Buy rating and $22 price target. We believe Stone has established itself as a leader for MSMB payments solutions in Brazil (~15% market share) and is well-positioned to expand its merchant relationships to also include banking and credit solutions. STNE differentiates in a complex Brazilian payments market by deploying a highly efficient distribution strategy that includes white glove service for an underserved SMB segment; STNE has grown SMB payments customers at a ~29% CAGR during the last four years. We believe STNE is a good way for investors to play the rapid growth of Brazil's central bank backed instant payment system Pix, especially as Pix expands beyond P2P payments and into P2B. An important tenet of STNE's future growth is credit solutions, which we note has caused the company challenges in the past. However, we think STNE is taking a more measured approach to its credit offerings today, pairing them with its payments and banking solutions. STNE is trading at 7x FY26 EPS; we think that is an attractive multiple as the company grows core business gross profit ~12%+ in FY26, while divesting non-core assets and pursuing aggressive share buybacks resulting in EPS growth of 20%+."

For an analyst ratings summary and ratings history on StoneCo Ltd. click here. For more ratings news on StoneCo Ltd. click here.

Shares of StoneCo Ltd. closed at $17.07 yesterday.

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