StoneCo ($STNE) 12% Purchase - 10x potential in five years??

StoneCo is a Brazilian fintech company in a hyper growth phase. Unlike most other fast growing fintech companies, $STNE is able to generate high margins and massive cash flows.

This company is a potential permanent position in my portfolio if they can continue to build out their ecosystem and create a moat around the merchants they serve.

0:00 Intro
2:29 Company overview & Potential moat
8:50 30/30 Club - Growth and Margins
12:47 Pix
15:36 Catalysts
22:18 Valuation
24:00 Risks
28:06 Final thoughts

Disclaimer: For educational purposes only. Do your own research before investing in any stock

[manemrob]

Alibaba and Stoneco are my two largest holdings. Short term headwinds causing cheap valuations but long term tailwinds for these great businesses.

[korrakotesinghaphant]

Your valuation seems very optimistic, especially the growth rates given how fierce the competition in Brazil payment processing industry is. I agree that if the company can build its ecosystem, it might be able to do well. As we, the outsiders, could think of this solution, I am pretty sure those in the field would know this as well. Currently I cannot see why stne should win the competition.

Anyhow thanks for the video.

[Mike-ugyy]

Nice job Mike. Another Lazy quote, "PIX is like a gateway drug for consumers to the Stone payment system"

[tomasjernelov]

Thanks Mike. Pretty new to your channel. Really great content.

[Mikster_Mindo]

What is the lazy investor? Where can I find him?

[Mikster_Mindo]

Thanks for your analysis, top quality.

Your assumption that people that are introduced to Pix will move to cards, I do not share. They will probably stay with Pix I think. However, still a large part will still be using debit and credit cards so merchants will need their POS and they will be linked to all the other products StoneCo offers.

In China 100% is digital payment (Alipay and Tencent) but in other countries it seems to be mixed and not necessarily following this Chinese model... Looking at their growth rate, they'll probably do not have to worry for the coming quarters and years at least...

[mikeccall]

Good summary of StoneCo's biz. 2023 is going to be the return of credit bringing a very accretive jump to earnings.

[jeremynewell]

Thanks for explaining the pix issue. That was the main worry when I looked into it before. It's worth me taking another look at StoneCo. Good job.

[dcainfinadv]

This is great! The part about the law changes in 2011 and how is turned into a war on cash and legacy banks... also the Lin part about how the culture is extremely customer oriented great 👍

[carstenprause]

Numbers looked good. Thoughts? I assume you will be adding :-)

[aryanmaheshwari]

What do you think of Gannett (USA Today) as a turnaround play?

[PrashantParikh]

Excellent analysis. Based on Q2 earnings, do you feel the low margin is a threat for profitability?

[danielsoe]

Nice job 👍. Digging in and trying to understand the story is worth so much more to unlocking value.

[yosifgebreal]

Thanks for sharing & losing a lot of money 💰-PE

[mzhou]

You mentioned PagSeguro. I see that you picked StoneCo over PagSeguro. What do you see as StoneCo’s edge over PagSeguro?

[tomasjernelov]

Have you checked out Semler Scientific? They are on and off in the 30/30-club.

[alm]

A very interesting analysis. I also own a (small) position in StoneCo.