StoneCo Ltd. [STNE] Stock trading around $10.22 per share: What’s Next?

StoneCo Ltd. [NASDAQ: STNE] stock went on a downward path that fall over -2.20% on Wednesday, amounting to a one-week price decrease of less than -1.92%. The company report on August 18, 2022 that Stone reports 2Q22 revenues of R$ 2.3 billion and consolidated TPV of R$ 91 billion, combined with solid profitability increase.


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The company bet all quarterly guidance lines; Adjusted net income of R$ 76 million was 48% higher vs. previous quarter on a comparable basis.

Today, August 18, StoneCo Ltd. (Nasdaq: STNE) reported its financial results for the second quarter of 2022. The highlights are net revenues of R$ 2.3 billion, 5% above the guidance, and pre-tax earnings of R$ 107 million, 19% above the guidance. Revenue growth was driven by a 101.5% year on year rise in revenues from the Financial Services segment, which reached R$ 1.9 billion, combined with a 23% increase in revenues from the Software segment, which reached R$ 351 million. The company expects to continue consistently growing revenue and expanding margins throughout 2022.

Over the last 12 months, STNE stock dropped by -71.96%. The one-year StoneCo Ltd. stock forecast points to a potential upside of 8.5. The average equity rating for STNE stock is currently 2.70, trading closer to a bullish pattern in the stock market.

The market cap for the stock reached $2.78 billion, with 312.16 million shares outstanding and 214.86 million shares in the current float. Compared to the average trading volume of 6.40M shares, STNE stock reached a trading volume of 5134232 in the most recent trading day, which is why market watchdogs consider the stock to be active.

Guru’s Opinion on StoneCo Ltd. [STNE]:

Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for STNE shares is $11.17 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on STNE stock is a recommendation set at 2.70. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.

Goldman have made an estimate for StoneCo Ltd. shares, keeping their opinion on the stock as Sell, with their previous recommendation back on September 06, 2022. While these analysts kept the previous recommendation, Cantor Fitzgerald raised their target price to Overweight. The new note on the price target was released on April 08, 2022, representing the official price target for StoneCo Ltd. stock. Previously, the target price had yet another raise to $15, while Citigroup analysts kept a Buy rating on STNE stock. On February 18, 2022, analysts decreased their price target for STNE shares from 30 to 14.

The Average True Range (ATR) for StoneCo Ltd. is set at 0.75, with the Price to Sales ratio for STNE stock in the period of the last 12 months amounting to 1.61. The Price to Book ratio for the last quarter was 1.32, with the Price to Cash per share for the same quarter was set at 4.42. Price to Free Cash Flow for STNE in the course of the last twelve months was 4.80 with Quick ratio for the last quarter at 3.70.

STNE Stock Performance Analysis:

StoneCo Ltd. [STNE] fell into the red zone at the end of the last week, falling into a negative trend and dropping by -1.92. With this latest performance, STNE shares gained by 12.31% in over the last four-week period, additionally plugging by 7.58% over the last 6 months – not to mention a drop of -71.96% in the past year of trading.

Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for STNE stock in for the last two-week period is set at 48.78, with the RSI for the last a single of trading hit 46.10, and the three-weeks RSI is set at 49.96 for StoneCo Ltd. [STNE]. The present Moving Average for the last 50 days of trading for this stock 9.95, while it was recorded at 10.30 for the last single week of trading, and 10.55 for the last 200 days.

Insight into StoneCo Ltd. Fundamentals:

Operating Margin for any stock indicates how profitable investing would be, and StoneCo Ltd. [STNE] shares currently have an operating margin of -31.16 and a Gross Margin at +28.78. StoneCo Ltd.’s Net Margin is presently recorded at -50.35.

Return on Equity for this stock declined to -9.53, with Return on Assets sitting at -3.69.

StoneCo Ltd.’s liquidity data is similarly interesting compelling, with a Quick Ratio of 3.70 and a Current Ratio set at 3.70.

STNE Stock EPS

The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for STNE. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for StoneCo Ltd. go to 4.11%.

StoneCo Ltd. [STNE] Insider Position Details

There are presently around $1,897 million, or 67.60% of STNE stock, in the hands of institutional investors. The top three institutional holders of STNE stocks are: BLACKROCK INC. with ownership of 16,785,336, which is approximately 154.513% of the company’s market cap and around 12.74% of the total institutional ownership; BERKSHIRE HATHAWAY INC, holding 10,695,448 shares of the stock with an approximate value of $109.31 million in STNE stocks shares; and SUMITOMO MITSUI TRUST HOLDINGS, INC., currently with $98.08 million in STNE stock with ownership of nearly 0.192% of the company’s market capitalization.

Positions in StoneCo Ltd. stocks held by institutional investors increased at the end of November and at the time of the November reporting period, where 145 institutional holders increased their position in StoneCo Ltd. [NASDAQ:STNE] by around 44,667,934 shares. Additionally, 137 investors decreased positions by around 43,850,601 shares, while 38 investors held positions by with 97,080,468 shares. The mentioned changes placed institutional holdings at 185,599,003 shares, according to the latest SEC report filing. STNE stock had 40 new institutional investments in for a total of 2,707,360 shares, while 59 institutional investors sold positions of 17,501,941 shares during the same period.

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