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StoneCo Ltd. (STNE) Outperforms Broader Market: What You Need to Know

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In the latest trading session, StoneCo Ltd. (STNE - Free Report) closed at $11.59, marking a +1.13% move from the previous day. The stock outperformed the S&P 500, which registered a daily gain of 0.27%. Meanwhile, the Dow gained 0.65%, and the Nasdaq, a tech-heavy index, added 0.26%.

Shares of the company have depreciated by 0.09% over the course of the past month, underperforming the Computer and Technology sector's gain of 2.21% and the S&P 500's gain of 2%.

Market participants will be closely following the financial results of StoneCo Ltd. in its upcoming release. The company plans to announce its earnings on November 12, 2024. In that report, analysts expect StoneCo Ltd. to post earnings of $0.32 per share. This would mark year-over-year growth of 18.52%. At the same time, our most recent consensus estimate is projecting a revenue of $594.78 million, reflecting a 7.56% fall from the equivalent quarter last year.

STNE's full-year Zacks Consensus Estimates are calling for earnings of $1.21 per share and revenue of $2.42 billion. These results would represent year-over-year changes of +24.74% and +0.24%, respectively.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for StoneCo Ltd. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 10.64% upward. StoneCo Ltd. is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note StoneCo Ltd.'s current valuation metrics, including its Forward P/E ratio of 9.45. This indicates a discount in contrast to its industry's Forward P/E of 31.88.

We can also see that STNE currently has a PEG ratio of 0.4. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Internet - Software was holding an average PEG ratio of 2.1 at yesterday's closing price.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 61, putting it in the top 25% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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