StoneCo’s Elevated Take-Rate Yields Massive Buyback

Summary:

• StoneCo’s stock has declined over 40% YTD, but trades at an attractive 8.8x earnings, presenting a good entry point.
• Despite macroeconomic headwinds, STNE’s strong business model, banking license, and potential Linx sale bolster its long-term growth prospects.
• A $350 million share repurchase plan will boost short-term earnings and offset macroeconomic challenges.
• Increased payment volumes and value-added services enhance STNE’s stickiness, while the banking license increases customer retention and switching costs.

StoneCo (NASDAQ:STNE) is a Brazilian fintech providing hardware solutions for SMBs (small-medium business) and provide payment acquiring services. Since the start of the year, STNE’s stock price has declined by more than 40% and now trades at just

Analyst’s Disclosure: I/we have a beneficial long position in the shares of STNE either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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