Assessing DLocal (NasdaqGS:DLO) Valuation After Q3 Growth and Margin Outlook in Brazil, Argentina, and Beyond

DLocal (DLO) released its third-quarter 2025 results, reporting strong growth in payment volumes across Brazil and Argentina. Management addressed ongoing investor concerns about profit margins and geographic risk exposure during the earnings call.

See our latest analysis for DLocal.

DLocal’s 24% share price gain over the past three months reflects growing enthusiasm for its surging payment volumes and international reach, with investors warming to its disciplined margins amid ongoing expansion in Brazil and Argentina. Still, the 62.7% one-year total shareholder return shows that momentum has built strongly in the short term, even after a more challenging multi-year stretch.

If you’re interested in finding out which other companies are riding similar waves of fast growth and strong insider conviction, discover fast growing stocks with high insider ownership.

With earnings and upbeat guidance now in the open, does DLocal’s current valuation reflect all that rapid expansion and future potential, or is there still a window for investors to buy in before the next move higher?

Most Popular Narrative: 92.6% Undervalued

With DLocal shares closing at $14.52, the narrative from WynnLevi puts fair value insight far above current levels, reflecting bold conviction in the company’s evolving business model.

DLocal emphasizes continuous investment in developing new products and services. The company’s pipeline is closely tied to expanding into new geographic markets, integrating new payment methods, developing advanced tools for merchants, especially for managing collections and disbursements, and innovating solutions for complex transactions, such as cross-border payments and compliance with local regulations. DLocal highlights that these efforts are not just incremental but necessary to remain competitive amid rapid technological change, the entrance of new competitors, and evolving client demands.

Read the complete narrative.

Want to know what powers this bullish outlook? The narrative hints at aggressive expansion and operational innovation, but it is the forward-looking projections for top-line and margin growth that set it apart. Which numbers underpin such a lofty valuation? The full story behind these assumptions might just surprise you.

Result: Fair Value of $195.39 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, execution risks such as delays in rolling out new services or over-reliance on third-party technology could challenge DLocal’s expansive growth narrative.

Find out about the key risks to this DLocal narrative.

Another View: What Do Market Ratios Reveal?

Taking a step back from the narrative-driven valuation, a look at market ratios paints a more subdued picture. DLocal trades at 29.3 times earnings, a premium over both the US industry average of 13.5 and its own fair ratio of 22.5. Its peer group sits much higher at 60.8. This puts its valuation in an ambiguous spot, potentially exposing investors to sentiment swings if growth slows. Should we favor the robust growth story or be wary of paying a premium if the numbers fade?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own DLocal Narrative

If you have a different viewpoint or want to dig deeper into the financials, you can shape your own perspective in just a few minutes with Do it your way.

A great starting point for your DLocal research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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