StoneCo stock falls after Q3 results hurt by investments, fair value adjustment
- StoneCo (NASDAQ:STNE) stock drops 6.7% in after-hours trading after the Brazilian fintech's bottom line reflected increased investments in its operations and a fair value adjustment on equity securities.
- "As we indicated in the beginning of the year, we significantly increased the level of investments in our operation this quarter when compared to the third quarter of 2020, with incremental investments of approximately R$120M in the growth of our operation and in new businesses," the company said.
- Q3 adjusted EPS of R$0.46 (US$0.08) misses the consensus estimate of R$0.60 and declined from R$0.99 in the year-ago quarter.
- Q3 net loss of R$1.26B compares with net income of R$249.1M a year ago; includes fair value adjustment on equity securities designated at FVPL of $R1.34B.
- Take rate of 1.66% drops from 2.36% in the year-ago quarter; take rate ex-credit of 1.67% slips from 1.81%.
- Total payment volume of R$75.0B, +7.6% Y/Y, or R$73.9B excluding Coronavoucher, up 54%.
- Total active payment clients were 1.39M, up 112% Y/Y;
- Total period net additions of 293.8K, up 212% Y/Y.
- Active payment clients, excluding micromerchants, were 846.8K, up 43% Y/Y; period net additions, excluding micromerchants, were 80.9K, up 24% Y/Y.
- During the quarter, financial expenses, net, increased to R$330.7M from R$64.7M in the year-ago quarter;
- Cost of services were R$525.6M vs. R$208.1M;
- Administrative expenses were R$359.8M vs. R$106.2M; and
- Selling expenses were R$308.2M vs. R$139.5M.
- Conference call at 5:00 PM ET.
- Earlier, StoneCo reports Q3 results; recall that in August StoneCo saw higher than expected delinquencies as Brazil changed the recognition of receivables.