BTIG has begun coverage of StoneCo Ltd. (NASDAQ:STNE) with a Buy recommendation and a price objective of $22.00. The target is near InvestingPro’s Fair Value estimate, which indicates the stock may be trading below its intrinsic value. StoneCo shares were priced at $17.08 at the time of the report, after an 86.87% total return over the prior 12 months.
The research note positions StoneCo as a leading participant in Brazil’s payments sector for micro, small and medium-sized businesses, estimating the company holds roughly 15% market share. BTIG pointed to a robust expansion in the firm’s payments customer base for small and medium enterprises, which it said grew at an approximate compound annual rate of 29% over the last four years. That customer-growth trend is reflected in top-line momentum, with StoneCo’s revenue rising 24.13% in the most recent twelve-month period.
BTIG emphasized StoneCo’s strategy to differentiate itself in Brazil’s complex payments environment through an efficient distribution model that includes a white-glove service element aimed at underserved small and medium businesses. The firm further highlighted StoneCo as a vehicle to participate in growth tied to Pix - Brazil’s central bank-backed instant payment system - which BTIG views as a structural tailwind for the company’s payments and banking franchises.
Regarding credit products, the research team acknowledged previous difficulties with StoneCo’s credit solutions but said the company is shifting to a more cautious stance by linking credit more closely with its payments and banking offerings. BTIG expects that tighter integration to support future growth.
Analysts tracked by InvestingPro foresee StoneCo returning to profitability this year, with EPS projections for fiscal 2025 at $1.71. BTIG’s valuation view places the stock at 7x projected FY26 earnings per share, a multiple the firm considers attractive relative to its forecast for core business gross profit to expand by more than 12% in fiscal 2026. BTIG also cited management plans to sell non-core assets and pursue aggressive share repurchases, which could drive EPS growth north of 20% if executed as described.
InvestingPro data included in the coverage note indicates StoneCo’s management has been actively buying back shares. That dataset also shows an enterprise value to EBITDA ratio of 4.65, a level BTIG interprets as suggestive of investor value.
Operational and capital deployment updates were included in StoneCo’s recent filings. The company disclosed fourth-quarter 2025 results that beat EPS expectations, reporting $2.57 versus a $2.28 consensus, while revenue of $3.57 billion missed the $3.61 billion anticipated. In a separate filing with the U.S. Securities and Exchange Commission, StoneCo said it intends to distribute R$3 billion in excess capital for 2024 and to launch a share repurchase program of up to R$2 billion.
The firm also announced a leadership transition: CEO Pedro Zinner will resign effective March 2026, and Mateus Scherer - currently StoneCo’s chief financial officer and investor relations officer - will assume the CEO role. BTIG’s note references Scherer’s central role in the company’s financial planning and capital strategy.
Context and caveats
InvestingPro characterizes StoneCo as a "Prominent player in the Financial Services industry," while also noting the company was not profitable over the last twelve months. Those contrasting signals - visible market leadership and recent unprofitability - inform the range of analyst expectations and the valuation multiple BTIG is assigning.