StoneCo (NasdaqGS:STNE) Valuation Update After 133% Share Price Surge in 2024

StoneCo (NasdaqGS:STNE) shares have delivered an impressive run so far this year, climbing 133%. The stock also soared 41% in the past 3 months, which has fueled ongoing curiosity about its next moves among investors.

See our latest analysis for StoneCo.

StoneCo’s share price return of 133% so far this year and a recent 41% jump over the last three months have generated fresh buzz, suggesting that positive momentum is building around the business. Over the longer term, total shareholder returns have rebounded strongly over three years but remain well below five-year highs. This reflects just how dynamic the stock’s story is lately.

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With StoneCo’s rapid ascent still fresh in investors’ minds, the key question is whether its current price reflects all the optimism or if there is still an opportunity to buy in before further growth gets fully priced in.

Most Popular Narrative: 100% Undervalued

The most widely followed narrative sees StoneCo’s fair value at $19.08, just above the last close of $18.88. This suggests a potential opportunity that extends beyond the year’s rally. Investors are debating whether ongoing structural changes have set the stage for the next leap.

Cross-selling of end-to-end financial solutions (payments, digital banking, working capital credit) is increasing client engagement and wallet share, demonstrated by growing deposit balances (+36% year-over-year) and credit portfolio expansion (+25% sequentially). This is supporting higher recurring revenue and long-term net earnings improvement.

Read the complete narrative.

Curious what’s fueling analyst conviction? The secret behind this fair value centers on bold forecasts for profits, margins, and buybacks, plus one assumption you probably wouldn’t expect. Find out the financial leap that could transform the company’s outlook in just a few years.

Result: Fair Value of $19.08 (UNDERVALUED)

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

However, risks remain, including slower payment volume growth and increased credit portfolio losses. These factors could challenge StoneCo's profit momentum if conditions worsen.

Find out about the key risks to this StoneCo narrative.

Build Your Own StoneCo Narrative

If you want a different perspective or enjoy digging into the numbers yourself, you can shape your own view on StoneCo in just a few minutes. Do it your way

A great starting point for your StoneCo 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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