StoneCo (NASDAQ:STNE) Shares Gap Up After Better-Than-Expected Earnings

StoneCo Ltd. (NASDAQ:STNE) shares gapped up before the market opened on Wednesday following a better than expected earnings announcement. The stock had previously closed at $9.85, but opened at $10.86. StoneCo shares last traded at $11.32, with a volume of 4,927,529 shares changing hands.

The company reported $0.39 earnings per share for the quarter, beating the consensus estimate of $0.32 by $0.07. The firm had revenue of $582.20 million for the quarter, compared to analysts’ expectations of $3.59 billion. StoneCo had a net margin of 16.02% and a return on equity of 13.92%.

Wall Street Analyst Weigh In

A number of research analysts have commented on STNE shares. Citigroup reaffirmed a “neutral” rating and issued a $9.00 target price (down previously from $19.00) on shares of StoneCo in a research report on Thursday, January 16th. JPMorgan Chase & Co. cut their price target on shares of StoneCo from $21.00 to $15.00 and set an “overweight” rating on the stock in a research note on Monday, December 16th. The Goldman Sachs Group cut their price target on shares of StoneCo from $16.00 to $14.00 and set a “buy” rating on the stock in a research note on Thursday, February 6th. Barclays cut their target price on shares of StoneCo from $12.00 to $10.00 and set an “equal weight” rating on the stock in a research note on Wednesday, January 29th. Finally, Wells Fargo & Company upgraded shares of StoneCo from an “equal weight” rating to an “overweight” rating in a research note on Wednesday. One research analyst has rated the stock with a sell rating, two have given a hold rating, six have given a buy rating and one has given a strong buy rating to the company’s stock. According to data from MarketBeat, the company presently has an average rating of “Moderate Buy” and an average target price of $14.38.

Hedge Funds Weigh In On StoneCo

Several hedge funds have recently added to or reduced their stakes in STNE. Atria Investments Inc increased its stake in StoneCo by 19.0% in the third quarter. Atria Investments Inc now owns 20,258 shares of the company’s stock valued at $228,000 after purchasing an additional 3,241 shares during the last quarter. Thrivent Financial for Lutherans increased its stake in StoneCo by 9.8% in the third quarter. Thrivent Financial for Lutherans now owns 19,877 shares of the company’s stock valued at $224,000 after purchasing an additional 1,773 shares during the last quarter. Swiss National Bank purchased a new position in StoneCo in the third quarter valued at approximately $6,419,000. Intech Investment Management LLC purchased a new position in StoneCo in the third quarter valued at approximately $1,154,000. Finally, Citigroup Inc. increased its stake in StoneCo by 584.9% in the third quarter. Citigroup Inc. now owns 1,339,972 shares of the company’s stock valued at $15,088,000 after purchasing an additional 1,144,341 shares during the last quarter. 73.19% of the stock is currently owned by hedge funds and other institutional investors.

StoneCo Price Performance

The company has a market capitalization of $3.45 billion, a PE ratio of 8.73, a price-to-earnings-growth ratio of 0.41 and a beta of 2.33. The company has a debt-to-equity ratio of 0.47, a current ratio of 1.42 and a quick ratio of 1.42. The company’s 50 day simple moving average is $9.30 and its 200 day simple moving average is $9.98.

About StoneCo

StoneCo Ltd. provides financial technology and software solutions to merchants and integrated partners to conduct electronic commerce across in-store, online, and mobile channels in Brazil. It distributes its solutions, principally through proprietary Stone Hubs, which offer hyper-local sales and services; and sells solutions to brick-and-mortar and digital merchants through sales team.