DLocal LimitedNASDAQ: DLO

After reaching an important support level, DLocal (DLO) could be a good stock pick from a technical perspective. DLO surpassed resistance at the 200-day moving average, suggesting a long-term bullish trend.

DLocal (DLO) shares have started gaining and might continue moving higher in the near term, as indicated by solid earnings estimate revisions.

1 High-Growth Stock Down 50% to Buy Hand Over Fist

DLocal's stock is fairly valued at 16x next year's free cash flow, balancing growth potential with emerging market risks. The company is debt-free with $560 million in cash, reinforcing its strong financial position. DLocal's strategic expansion and robust transaction pipelines position it well for growth in emerging markets.

DLocal (DLO) came out with quarterly earnings of $0.15 per share, beating the Zacks Consensus Estimate of $0.09 per share. This compares to earnings of $0.16 per share a year ago.

Third Quarter 2024 Robust TPV growth, up 41% YoY and 8% QoQ, driven by strong performance across various verticals and countries Record gross profit reaching $78M in the quarter, with net take rate stable at 1.2% since Q1 2024 Operating leverage expansion for the 2nd consecutive quarter, with Adjusted EBITDA over gross profit margin reaching 67% in Q3 2024 (+6 p.p. QoQ)

DLocal excels in emerging markets, but is a small player compared to giants like Block and PayPal. Despite its size, DLocal has strong executive alignment, with 48.45% insider ownership and co-founder involvement on the board. Gross margins have significantly declined from 65% to 41%, raising concerns, but revenue growth remains robust at 26-27% annually.

MONTEVIDEO, Uruguay, Oct. 15, 2024 (GLOBE NEWSWIRE) -- DLocal Limited (NASDAQ: DLO, “dLocal” or the “Company”), a technology-first payments platform enabling global enterprise merchants to connect with billions of consumers in emerging markets, intends to release financial results for its third fiscal quarter ended September 30, 2024 on November 13, 2024 after market close.

This South American company is still profitable and growing fast.