StoneCo: Revs Up 113%, NI Up 646%

Thanks GM

The slides are here for a quick take in anyone is interested

StoneCo Ltd. 2018 Q4 - Results - Earnings Call Slides https://seekingalpha.com/article/4249613?source=ansh $STNE

And the ER Transcript is here

StoneCo’s (STNE) CEO Thiago Piau on Q4 2018 Results - Earnings Call Transcript https://seekingalpha.com/article/4249622?source=ansh $STNE

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S. America is well known for currency crises

GrowthMonkey - I remember a couple years (?) ago something along the lines of MELI removing Venezeula from their estimates because of radically high inflation. Do you know what other countries have similar problems that pose a risk factor?

-AJ

Growth Monkey,

So if TAM is 180B RBL, or $46B in US dollars and STNE market cap $11B, that means the market is pricing STNE as if it has quarter of the total TAM already. Is that the right way to read it?

On #6 earning call slides, I see TAM for Acquiring 20B, Credit 75B, banking 10B and SW 9.5B, total 115B RBL. Far from your 180B. Am I reading this correctly?

many thx

In addition to Venezuela, both Argentina and Brazil have experienced currency devaluations and since my base currency is US Dollars; am not going to increase my position in StoneCo.

Finally, in my post, I made a mistake when stating the TAM of the banking/credit/Saas segment but the rest of the calculation is still correct.

TOTAL TAM (including future credit card penetration/merchant acquisitions) is still around BRL 140 billion and in yesterday’s post, I used that figure when estimating future revenue and net profit.

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Hey GM,
Congrats on a great pick and great outcome… it’s the stuff of legends…
And it looks like this company is still undervalued.

I have stayed away mostly because of currency fluctuations and also emerging markets stocks being depresssed for a long time. With fed clearing the interest rate hurdle, may be there is tail wind on emerging market stocks and right time to get into few, extra ordinary names like STNE.

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Thanks Nilvest, I didn’t expect it to more than double in 2.5 months!

MELI has also done very well over the past few months and I am long.

I think STNE can triple from here in a few years, time will tell.

You are right, After 7-8 years, EMs have turned the corner and over the past few months EEM/SPX ratio chart has been in an uptrend.

All the best!

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