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01/09 20:07
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call reveals strong financial performance, exceeding guidance in key areas like net income, credit portfolio, and take rate. Despite a slight miss in MSMB card TPV, the overall performance is robust, with significant growth in retail deposits and adjusted EPS. The Q&A highlights disciplined risk management and strategic pricing initiatives. The market cap suggests moderate sensitivity, and the positive financials and strategic outlook indicate a likely stock price increase of 2% to 8% over the next two weeks.
MSMB card TPV BRL403 billion, 15% year-over-year growth; fell short of BRL412 billion guidance due to faster-than-expected adoption of PIX.
Total MSMB TPV BRL454 billion, 22% year-over-year increase; exceeded expectations.
Retail deposits BRL8.7 billion, exceeded BRL7 billion guidance; reflects strong performance of bundled payments and banking offerings.
MSMB take rate 2.55%, exceeded 2.49% guidance; reflects disciplined pricing and growing contribution from banking and credit solutions.
Credit portfolio BRL1.2 billion, significantly exceeding BRL800 million target; maintained controlled risk and healthy profitability.
Net income BRL2.2 billion, exceeding BRL1.9 billion guidance; strong performance from successful monetization and efficiency improvements.
Adjusted administrative expenses BRL994 million, compared to BRL1.125 billion guidance; reflects ongoing efficiency improvements.
Adjusted EBT Grew 22% year-over-year; reflects strong bottom line results.
Adjusted net income Grew 18% year-over-year; reflects solid performance despite macroeconomic headwinds.
Adjusted basic EPS Increased 26% compared to the fourth quarter of '23; driven by share buybacks.
Gross profit BRL1.7 billion, growing 13% year-over-year; reflects lower provision for loan losses and lower cost to fund business.
Financial Services segment revenues Grew 11% year-over-year to BRL3.2 billion; driven by successful execution of strategic priorities.
Adjusted net cash position BRL4.7 billion; sequential decrease of BRL0.2 billion due to ongoing share repurchase activity.
Credit quality (NPLs over 90 days) 3.61%; reflects controlled risk management.
Effective tax rate 14.5%, down from 20% in Q3; driven by gains from entities abroad and tax incentives.
Software revenue Grew 15% year-over-year; driven by strong performance in portfolio companies.
Software adjusted EBITDA margin 21.6%, strong growth year-over-year; reflects revenue performance and operational efficiencies.
ROE 27% in 2024, 5 percentage points higher than in 2023.
Time deposits Reached BRL430 million; significant driver of engagement.
Accumulated loan loss provision expenses ratio 12% for working capital portfolio; down from 20% a year ago.
Excess capital Over BRL3 billion; expected to return to shareholders over time.
Retail Deposits: Retail deposits closed 2024 at BRL8.7 billion, exceeding our BRL7 billion guidance.
Credit Portfolio: Our credit portfolio reached BRL1.2 billion in 2024, significantly exceeding our BRL800 million target.
Software Revenue Growth: Software revenue grew 15% year-over-year in the quarter.
MSMB Card TPV: MSMB card TPV reached BRL403 billion, representing 15% year-over-year growth.
Total MSMB TPV: Total MSMB TPV exceeded expectations, reaching BRL454 billion, a 22% year-over-year increase.
MSMB Payments Active Client Base: MSMB payments active client base increased 19% year-over-year to 4.1 million clients.
Adjusted Net Income: Adjusted net income grew 18% over the same period.
Adjusted Administrative Expenses: Adjusted administrative expenses of BRL994 million compared to our BRL1.125 billion guidance.
Gross Profit: Gross profit in the quarter reached BRL1.7 billion, growing 13% year-over-year.
Cross-Selling Strategy: Achieved greater success leveraging financial services distribution channels rather than relying on software-specific sales force.
Capital Allocation Strategy: Maintaining a minimum common capital ratio at StoneCo equal to 20% of our risk-weighted assets.
Guidance Simplification: For 2025, we expect adjusted gross profit above BRL7.05 billion and adjusted basic EPS above BRL8.6 per share.
Market Challenges: Despite significant progress, the company faced market challenges in 2024, particularly due to macroeconomic headwinds and a less favorable environment towards the end of the year.
Competitive Pressures: The faster-than-expected adoption of PIX has impacted MSMB card TPV growth, indicating competitive pressures in the payments market.
Regulatory Issues: The company referenced potential risks associated with regulatory changes, particularly in the context of their forward-looking statements.
Supply Chain Challenges: There were no specific mentions of supply chain challenges in the transcript.
Economic Factors: The company acknowledged the impact of rising yield curves on financial expenses and the overall macroeconomic environment affecting client behavior and credit performance.
Credit Quality Risks: While the credit portfolio showed growth, there are concerns about potential increases in non-performing loans (NPLs) as the portfolio matures, indicating credit quality risks.
Goodwill Impairment: A goodwill impairment charge of BRL3.6 billion was recognized due to lower growth expectations and a challenging macroeconomic environment, reflecting risks in the software segment.
MSMB card TPV: In 2024, MSMB card TPV reached BRL403 billion, representing 15% year-over-year growth, slightly short of the BRL412 billion guidance due to faster-than-expected adoption of PIX.
Retail deposits: Retail deposits closed 2024 at BRL8.7 billion, exceeding the BRL7 billion guidance, reflecting strong performance in bundled payments and banking offerings.
MSMB take rate: Achieved an MSMB take rate of 2.55% in 2024, exceeding the 2.49% guidance.
Credit portfolio: Credit portfolio reached BRL1.2 billion in 2024, significantly exceeding the BRL800 million target.
Adjusted administrative expenses: Adjusted administrative expenses were BRL994 million, compared to the BRL1.125 billion guidance.
Software strategy: Shifted focus on cross-selling financial services rather than relying solely on software-specific sales.
2025 Adjusted Gross Profit: Expected to exceed BRL7.05 billion, reflecting year-over-year growth of 14%.
2025 Adjusted Basic EPS: Expected to exceed BRL8.6 per share, reflecting year-over-year growth of 18%.
2027 MSMB TPV: Projected to surpass BRL670 billion, implying a CAGR above 14% from 2024 to 2027.
2027 Adjusted Gross Profit: Expected to exceed BRL10.2 billion, translating to a CAGR of over 18%.
2027 Adjusted Basic EPS: Expected to exceed BRL15 per share, representing a CAGR of over 27%.
Share Buyback Program: StoneCo has an active BRL2 billion buyback program, under which BRL608 million or 10.9 million shares were repurchased in the first quarter of 2024. For the full year, a total of BRL1.6 billion was allocated for share repurchases.
The company shows strong financial metrics, with significant EPS growth and upward revisions in net income guidance. Despite some concerns about TPV deceleration and NPL growth, management's focus on client value and profitability is reassuring. The strategic divestitures and shareholder returns through buybacks further bolster investor confidence. The market cap suggests moderate stock reaction, aligning with a positive outlook.
The earnings call summary highlights strong financial performance with significant growth in gross profit and EPS, a new share repurchase program, and a solid credit portfolio. The Q&A section shows management's confidence in achieving long-term targets despite macroeconomic challenges. The upward revision of net income guidance and sustainable financial income growth further support a positive sentiment. The market cap indicates a moderate reaction, leading to a prediction of a 2% to 8% stock price increase over the next two weeks.
The earnings call reveals strong financial performance with year-over-year growth in revenue and gross profit, along with optimistic guidance for future growth. The share repurchase program indicates confidence in the company's value. Despite some concerns about increased costs and regulatory risks, the company's strategic initiatives and market differentiation provide a positive outlook. The market cap suggests moderate sensitivity to news, supporting a positive stock price movement prediction.
The earnings call reveals strong financial performance, exceeding guidance in key areas like net income, credit portfolio, and take rate. Despite a slight miss in MSMB card TPV, the overall performance is robust, with significant growth in retail deposits and adjusted EPS. The Q&A highlights disciplined risk management and strategic pricing initiatives. The market cap suggests moderate sensitivity, and the positive financials and strategic outlook indicate a likely stock price increase of 2% to 8% over the next two weeks.
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