Is StoneCo (STNE) A Great Investment Choice?

LRT Capital Management, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A return of -6.71% was recorded by the LRT Economic Moat strategy for the month of November 2021, extending its 12-month returns to +23.06%. Year-to-date, LRT Capital was able to post a gain of +17.91%. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

LRT Capital Management, in its Q3 2021 investor letter, mentioned StoneCo Ltd. (NASDAQ: STNE) and discussed its stance on the firm. StoneCo Ltd. is a Cayman Islands-based financial technology solutions provider with a $5.4 billion market capitalization. STNE delivered a -78.93% return since the beginning of the year, while its 12-month returns are down by -76.46%. The stock closed at $17.68 per share on December 10, 2021.

Here is what LRT Capital Management has to say about StoneCo Ltd. in its Q3 2021 investor letter:

StoneCo Ltd. (STNE) – this Brazilian merchant acquirer is dealing with short term problems in its lending operation and a recession that is hitting the Brazilian economy. Yet, despite this, the company remains profitable and continues to grow. It is a potential multi-bagger from where it trades today. We are similarly bullish on PagSeguro Digital Ltd. (PAGS), and similar company, that also operating in Brazil.”

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Based on our calculations, StoneCo Ltd. (NASDAQ: STNE) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. STNE was in 37 hedge fund portfolios at the end of the third quarter of 2021, compared to 44 funds in the previous quarter. StoneCo Ltd. (NASDAQ: STNE) delivered a -59.23% return in the past 3 months.

Earlier this year, we also shared LRT Capital’s views on STNE in another article. You can find more than 100 investor letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q3 page.

Disclosure: None. This article is originally published at Insider Monkey.