​PagSeguro Digital Ltd. (NYSE:PAGS) is one of the Most Undervalued Fintech Stocks to Buy Now. PagSeguro Digital Ltd. (NYSE:PAGS) is set to release its fiscal Q4 2025 earnings on March 5. Wall Street expects the company to post a quarterly revenue of roughly $981.30 million, along with an EPS of $0.39. ​Recently, on December 16, Mario Pierry from Bank of America Securities reiterated a Buy rating on the stock with a price target of $13. The analyst noted that the rating is based on the company’s strategic ...

We came across a bullish thesis on PagSeguro Digital Ltd. on Value investing subreddit by KraticCapital. In this article, we will summarize the bulls’ thesis on PAGS. PagSeguro Digital Ltd.'s share was trading at $10.43 as of January 12th. PAGS’s trailing and forward P/E were 7.69 and 6.98 respectively according to Yahoo Finance. Is Kaspi.kz (KSPI) the Best Young Stock To Buy and Hold For 10 Years? PagSeguro Digital Ltd. (PAGS), a Brazilian fintech founded in 2006 and IPO’ed in 2018, provides payment pro ...

Group 1 - Middle Coast Investing reported a strong performance in 2025, with the S&P 500 showing a 21.2% annualized return over the past three years, indicating signs of slowing growth [1] - In Q4 2025, the US Portfolios returned 2.7%, outperforming the S&P 500's return of 2.3%, while Core U.S. portfolios returned 1.9% [1] - The European Portfolios experienced a decline of -0.4% in the same quarter [1] Group 2 - PagSeguro Digital Ltd. (NYSE:PAGS) was highlighted as a key stock, closing at $10.13 per share on January 13, 2026, with a one-month return of 8.46% and a 52-week gain of 46.39% [2] - PagSeguro Digital Ltd. has a market capitalization of $2.957 billion [2] - The firm emphasized a strategy of diversifying from US holdings, indicating a focus on non-US stocks, with PagSeguro being a notable addition to the portfolio [3]

Company Performance - PagSeguro Digital Ltd. (PAGS) stock decreased by 2.88% to $10.13, which is less than the S&P 500's daily loss of 0.19% [1] - Over the past month, the stock has increased by 4.09%, outperforming the Business Services sector's loss of 0.17% and the S&P 500's gain of 2.26% [1] Earnings Expectations - Analysts expect PagSeguro to report earnings of $0.42 per share, reflecting a year-over-year growth of 23.53% [2] - Revenue is anticipated to be $1.02 billion, indicating a 16.51% increase compared to the same quarter last year [2] Full Year Projections - For the full year, earnings are projected at $1.44 per share, representing a growth of 19.01%, while revenue is expected to remain flat at $3.81 billion [3] Analyst Estimates - Recent modifications to analyst estimates indicate a dynamic business outlook, with positive revisions suggesting optimism [4] - The consensus EPS projection has decreased by 1.37% in the past 30 days, and PagSeguro currently holds a Zacks Rank of 3 (Hold) [6] Valuation Metrics - PagSeguro is trading at a Forward P/E ratio of 6.44, which is below the industry average Forward P/E of 13.33 [7] - The company has a PEG ratio of 0.44, compared to the Financial Transaction Services industry average PEG ratio of 0.99 [8] Industry Context - The Financial Transaction Services industry, part of the Business Services sector, has a Zacks Industry Rank of 194, placing it in the bottom 21% of over 250 industries [9]

Company Performance - PagSeguro Digital Ltd. closed at $9.62, reflecting a decrease of 2.83% from the previous day, underperforming compared to the S&P 500's loss of 0.34% [1] - Over the last month, the company's shares have decreased by 0.1%, while the Business Services sector gained 2.46% and the S&P 500 gained 1.19% [1] Earnings Projections - PagSeguro Digital Ltd. is projected to report earnings of $0.39 per share, indicating a year-over-year growth of 14.71%, with quarterly revenue expected to reach $1 billion, up 14.8% from the previous year [2] - Full-year Zacks Consensus Estimates predict earnings of $1.36 per share and revenue of $3.77 billion, representing year-over-year changes of +12.4% for earnings and 0% for revenue [3] Analyst Estimates and Valuation - Recent changes to analyst estimates suggest a favorable outlook on the company's business health and profitability, with a Zacks Rank of 3 (Hold) currently [3][5] - The Forward P/E ratio for PagSeguro Digital Ltd. is 6.56, which is a discount compared to the industry average of 12.8 [6] - The company has a PEG ratio of 0.45, significantly lower than the Financial Transaction Services industry's average PEG ratio of 0.93 [7] Industry Context - The Financial Transaction Services industry, part of the Business Services sector, has a Zacks Industry Rank of 171, placing it in the bottom 31% of over 250 industries [8] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]

Group 1 - The analyst has over a decade of experience researching various companies across different sectors, including commodities like oil, natural gas, gold, and copper, as well as technology firms such as Google and Nokia [1] - The analyst has transitioned from writing a blog to creating a value investing-focused YouTube channel, where extensive research on hundreds of companies has been conducted [1] - The analyst expresses a particular interest in covering metals and mining stocks, while also being comfortable with other industries such as consumer discretionary/staples, REITs, and utilities [1]

Group 1 - The article does not provide any specific content related to a company or industry [1]

Core Insights - PagBank reported strong financial results for the third quarter of 2025, showcasing resilience in a high-interest-rate environment and economic slowdown [2][4] - The bank's recurring net income reached BRL 571 million, with net revenue growing by 14.4% year-over-year to BRL 3.4 billion [4] - Deposits increased to BRL 39.4 billion, reflecting a 15.3% year-over-year growth, while the loan portfolio expanded to BRL 4.2 billion, marking a 29.9% year-over-year increase [5] Financial Performance - Recurring net income for 3Q25 was BRL 571 million [4] - Net revenue grew 14.4% year-over-year, totaling BRL 3.4 billion [4] - Deposits reached BRL 39.4 billion, up 15.3% year-over-year and 6.1% quarter-over-quarter [5] - The loan portfolio amounted to BRL 4.2 billion, with a year-over-year growth of 29.9% and a quarter-over-quarter increase of 7.2% [5] Strategic Initiatives - The bank distributed over BRL 2 billion to shareholders through dividends and share repurchases in the last 12 months [3] - PagBank is focusing on higher-margin products and sustainable value creation while expanding its revenue and optimizing its capital structure [2] - The bank aims to deepen relationships with entrepreneurs and consumers, enhancing access to financial solutions for millions of Brazilians [6] Leadership Changes - Carlos Mauad will become the new CEO of PagBank starting January 1, 2026, as part of a planned succession process [7] - Gustavo Sechin will take over as the new CFO [7] - The transition is expected to ensure continuity and support for the bank's growth strategy [8][9]

Core Insights - PagSeguro Digital Ltd. reported quarterly earnings of $0.36 per share, exceeding the Zacks Consensus Estimate of $0.35 per share, and up from $0.32 per share a year ago, representing an earnings surprise of +2.86% [1] - The company posted revenues of $937.15 million for the quarter ended September 2025, which missed the Zacks Consensus Estimate by 2.36%, compared to $871.26 million in the same quarter last year [2] - PagSeguro Digital shares have increased approximately 58.6% year-to-date, significantly outperforming the S&P 500's gain of 16.4% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.39, with expected revenues of $1.03 billion, and for the current fiscal year, the estimate is $1.39 on revenues of $3.68 billion [7] - The estimate revisions trend for PagSeguro Digital was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Financial Transaction Services industry, to which PagSeguro Digital belongs, is currently ranked in the bottom 32% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact investor sentiment and stock performance [5]

Financial Performance - Total revenue for the three-month period ended September 30, 2025, was R$5,105,410, an increase of 5.66% compared to R$4,831,492 for the same period in 2024[9] - Net income for the nine-month period ended September 30, 2025, rose to R$1,616,337, up 6.53% from R$1,517,344 in the prior year[11] - Basic earnings per common share for the three-month period ended September 30, 2025, increased to R$1.8998, compared to R$1.6726 in the same period of 2024, representing a growth of 13.56%[10] - Net income for the nine-month period ended September 30, 2025, was R$1,832,586, an increase from R$1,743,634 in the same period of 2024, reflecting a growth of approximately 5.1%[14] - Total revenue and income for the nine-month period ended September 30, 2025, was R$15,013,736, an increase from R$13,694,621 in the same period of 2024, representing a growth of 9.6%[121] - Basic earnings per share for the nine-month period ended September 30, 2025, was R$5.4292, compared to R$4.7737 for the same period in 2024, reflecting an increase of 13.7%[118] Assets and Liabilities - As of September 30, 2025, total assets decreased to R$72,285,249 from R$72,900,617 as of December 31, 2024, reflecting a decline of approximately 0.85%[6] - Total liabilities decreased to R$57,397,264 as of September 30, 2025, from R$58,232,245 at the end of 2024, indicating a reduction of approximately 1.43%[8] - The company’s total equity increased to R$14,887,985 as of September 30, 2025, compared to R$14,668,372 at the end of 2024, representing a growth of 1.49%[8] - The total financial liabilities as of September 30, 2025, were R$54,969,799, a decrease from R$55,643,518 as of December 31, 2024, showing a reduction of 1.2%[132] Cash and Cash Equivalents - Cash and cash equivalents increased to R$1,427,303 as of September 30, 2025, from R$927,668 at the end of 2024, marking a significant increase of 53.67%[6] - Cash and cash equivalents as of September 30, 2025, were R$1,427,303, up from R$927,668 as of December 31, 2024, indicating a 53.9% increase[147] Accounts Receivable - The company reported a decrease in accounts receivable from R$57,628,538 as of December 31, 2024, to R$56,625,151 as of September 30, 2025, a decline of about 1.75%[6] - Accounts receivable totaled R$59,055,725 as of September 30, 2025, slightly down from R$59,803,273 at the end of 2024, reflecting a decrease of about 1.2%[41] - The company reported a significant decrease in accounts receivable, with a reduction of R$3,432,483 compared to R$15,646,034 in the previous year, suggesting improved collection processes[14] - Past due accounts receivable increased to R$327,889 from R$272,294, representing a growth of approximately 20.4%[44] - Expected credit losses (ECL) for accounts receivable rose to R$314,572, up from R$284,620, indicating a 10.1% increase[44] - The net receivables after ECL stood at R$3,838,347 as of September 30, 2025, compared to R$3,152,793 at the end of 2024, reflecting a growth of 21.8%[44] Financial Costs and Expenses - Total expenses for the nine-month period ended September 30, 2025, were R$13,181,150, compared to R$11,950,988 in 2024, which is an increase of 10.3%[123] - Financial costs for the nine-month period ended September 30, 2025, increased to R$3,852,323, compared to R$2,654,889 in 2024, reflecting a rise of 45%[123] Investments and Subsidiaries - The company established a new subsidiary, PSGP México Aggregator S. de R.L. de C.V., in April 2025, aimed at expanding its operational footprint in Mexico[20] - PagSeguro Digital's investment in Fundo de Investimento em Direitos Creditórios – PagSeguro increased to 20% following the acquisition of additional shares in June 2024[18] Shareholder Actions - The company paid dividends totaling R$431,206 during the nine-month period, marking a new distribution to shareholders[15] - The company authorized a new share repurchase program on May 29, 2025, allowing for the repurchase of up to US$200 million in outstanding Class A common shares[111] - The first dividend payment of US$0.14 per common share was approved on May 13, 2025, totaling R$236,037, with payments made to both UOL and third-party shareholders[114] Tax and Contingencies - The effective income tax and social contribution rate for the nine-month period ended September 30, 2025, was 12%, compared to 13% for the same period in 2024[95] - The total provision for contingencies amounted to R$1,152,777, an increase from R$996,526 on December 31, 2024[83] - The main tax lawsuit against PagSeguro Internet involves an assessment of R$336,022 related to the non-collection of tax on financial operations, up from R$315,403 on December 31, 2024[84] Borrowings and Financial Instruments - The borrowings balance decreased to R$2,398,160 as of September 30, 2025, from R$4,521,503 on December 31, 2024, reflecting a significant reduction in debt[89] - The Group's obligations to FIDC quota holders amounted to R$1,128,717 as of September 30, 2025, with an average cost of 108% of CDI[70] - The derivative financial instruments portfolio included liabilities of R$632,364 for EUR swaps and R$945,947 for another EUR swap as of September 30, 2025[155] Operational Efficiency - Total losses for the nine-month period decreased to R$269,321 from R$335,402 in 2024, indicating improved operational efficiency[14] - The Group recorded a profit before taxes of R$636,432 for the three-month period ended September 30, 2025, compared to R$593,540 for the same period in 2024, indicating a year-over-year growth[94]