Spain’s credit rating upgraded to ’A+’ by S&P on strong growth
Investing.com - BofA Securities raised its price target on StoneCo Ltd. (NASDAQ:STNE) to $25.00 from $15.00 on Tuesday, while maintaining a Buy rating on the Brazilian fintech company’s stock. The stock has shown remarkable momentum, delivering a 116.56% return year-to-date, with InvestingPro data showing multiple analysts revising earnings expectations upward.
The price target increase represents a potential 45% upside from StoneCo’s current trading level, according to the research firm. Trading near its 52-week high of $17.49, StoneCo’s valuation appears to align with analyst optimism, supported by expected revenue growth of 21% for FY2025.
BofA Securities attributed $23 per share of the new target to StoneCo’s core business, based on a target price-to-earnings multiple of 11 times the firm’s 2026 earnings per share estimate of $2.09.
The remaining $2 per share of the price target comes from Linx, based on the announced transaction value of R$3.2 billion, which BofA Securities notes could potentially be distributed as dividends or used for share buybacks.
The firm’s price target methodology and multiple remain unchanged from its previous analysis, with the upward revision primarily reflecting increased earnings projections and the value of the Linx transaction.
In other recent news, StoneCo Ltd reported its Q2 2025 earnings with an impressive performance, as the company achieved an earnings per share (EPS) of 2.33 BRL. This result exceeded analysts’ expectations, which were set at 1.99 BRL, marking a 17.09% increase above the forecast. Despite this strong EPS showing, StoneCo experienced a revenue miss, though specific figures were not disclosed. The company’s robust earnings performance has captured investor attention and reflects optimism in the market. These developments come as part of the company’s ongoing financial reporting and strategic positioning. Analyst firms have yet to provide updates on any stock upgrades or downgrades following these earnings results. Investors are closely monitoring these outcomes as they evaluate StoneCo’s financial health and future potential.
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