StoneCo (NASDAQ:STNE) Shares Gap Up Following Strong Earnings

StoneCo Ltd. (NASDAQ:STNE - Get Free Report)'s share price gapped up before the market opened on Wednesday after the company announced better than expected quarterly earnings. 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 traded.

The company reported $0.39 EPS 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 analyst estimates of $3.59 billion. StoneCo had a return on equity of 13.92% and a net margin of 16.02%.

Analyst Ratings Changes

STNE has been the topic of several research reports. Citigroup restated a "neutral" rating and set a $9.00 price target (down previously from $19.00) on shares of StoneCo in a research note on Thursday, January 16th. Morgan Stanley lifted their target price on StoneCo from $5.70 to $6.00 and gave the company an "underweight" rating in a research note on Friday. JPMorgan Chase & Co. cut their target price on StoneCo from $21.00 to $15.00 and set an "overweight" rating on the stock in a research note on Monday, December 16th. Wells Fargo & Company upgraded StoneCo from an "equal weight" rating to an "overweight" rating in a research note on Wednesday. Finally, Barclays lifted their target price on StoneCo from $10.00 to $12.00 and gave the company an "equal weight" rating in a research note on Friday. One equities 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. According to data from MarketBeat.com, StoneCo has a consensus rating of "Moderate Buy" and a consensus price target of $14.50.

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Institutional Investors Weigh In On StoneCo

Institutional investors and hedge funds have recently modified their holdings of the company. Jones Financial Companies Lllp lifted its holdings in shares of StoneCo by 254.7% during the fourth quarter. Jones Financial Companies Lllp now owns 4,256 shares of the company's stock worth $34,000 after purchasing an additional 3,056 shares during the period. Sterling Capital Management LLC lifted its holdings in StoneCo by 627.0% in the fourth quarter. Sterling Capital Management LLC now owns 4,551 shares of the company's stock valued at $36,000 after acquiring an additional 3,925 shares during the period. Newbridge Financial Services Group Inc. lifted its holdings in StoneCo by 166.7% in the fourth quarter. Newbridge Financial Services Group Inc. now owns 6,400 shares of the company's stock valued at $51,000 after acquiring an additional 4,000 shares during the period. SBI Securities Co. Ltd. acquired a new position in StoneCo in the fourth quarter valued at approximately $56,000. Finally, Skandinaviska Enskilda Banken AB publ lifted its holdings in StoneCo by 31.6% in the fourth quarter. Skandinaviska Enskilda Banken AB publ now owns 7,500 shares of the company's stock valued at $59,000 after acquiring an additional 1,800 shares during the period. Institutional investors and hedge funds own 73.19% of the company's stock.

StoneCo Price Performance

The company has a market capitalization of $3.43 billion, a price-to-earnings ratio of 8.67, a P/E/G ratio of 0.41 and a beta of 2.33. The stock has a fifty day simple moving average of $9.36 and a 200-day simple moving average of $9.92. The company has a debt-to-equity ratio of 0.47, a current ratio of 1.42 and a quick ratio of 1.42.

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.