In acquiring, record TPV of 124 billion BRL, three times the industry's growth; in banking, record revenue of 434 million BRL, +41% higher than the same period in 2023 SÃO PAULO, Aug. 21, 2024 /PRNewswire/ -- PagBank (NYSE: PAGS), a complete digital bank in financial services and payments solution, announces its results for the second quarter of 2024 (2Q24). Among the key highlights of the period, the company recorded a record net income (Non-GAAP) of 542 million BRL (+31% y/y). Net income in a GAAP basis, ...

Marcio Binow Da Silva/iStock via Getty Images Some LatAm fintechs are attracting the attention of investors because they combine growth potential with a cheap valuation. One example of this is Nu Holdings (NU), but as I mentioned in a recent article, its valuation has already become premium. However, there are other alternatives that still have more attractive valuations and similar characteristics. This is the case of PagSeguro (NYSE:PAGS), a Brazilian fintech (in the payments and banking sector) that is t ...

Financial Data and Key Metrics - Total revenue grew 19% YoY to BRL 4.6 billion, driven by strong TPV and revenue growth across all client segments [6] - Gross profit margin reached nearly 40%, an 86 basis points increase compared to Q2 2023, and 40.3% on a year-to-date basis [6] - Net income reached BRL 542 million, a 31% YoY growth, with EPS at BRL 1.68, a 32% increase YoY [6] - Deposits reached a record BRL 34.2 billion, an 87% YoY increase, reflecting strong client engagement and lower funding costs [7] - TPV grew 34% YoY to BRL 124 billion, significantly outpacing the card industry's 11% growth [8] Business Line Performance - Payments TPV grew 34% YoY to BRL 124 billion, with TPV per merchant up 42% YoY [10] - MSMB segment TPV grew 28% YoY to BRL 83.6 billion, driven by cross-selling and productivity improvements [11] - LMEC segment TPV grew 50% YoY to BRL 40.8 billion, accounting for one-third of total TPV, with strong growth in e-commerce and cross-border transactions [12] - Banking segment cash-in reached BRL 76.4 billion, a 52% YoY growth, with active banking clients growing 5% YoY to 17.3 million [13] - Credit portfolio grew 11% YoY to BRL 2.9 billion, with secured products representing 80% of the portfolio [15] Market Performance - The company added 2 million clients in the last 12 months, reaching 31.6 million clients by the end of June, with 17.7 million active clients [7] - PagBank app received high ratings of 4.9 stars on the App Store and 4.8 stars on Google Play [8] - The company achieved an AAA rating from both Moody's and S&P, enhancing its financial strength and CDS distribution [14] Strategic Direction and Industry Competition - The company is focused on expanding its payments business with a merchant profile that offers better engagement and profitability [10] - The strategy includes attracting merchants with monetization potential in financial services, particularly in the MSMB and LMEC segments [8] - The company is leveraging its banking platform to provide a seamless experience combining payments, value-added services, and banking, driving higher client engagement [13] - The company is exploring alternatives to reduce the cost of funding, supported by its strong deposit franchise [15] Management Commentary on Operating Environment and Future Outlook - Management highlighted the strong operational and financial performance, with all-time highs in key metrics such as revenue, net income, and TPV [6] - The company expects to maintain a gross profit margin above 40% for the year, with TPV guidance increased to BRL 480-505 billion [23] - Management emphasized the importance of balancing growth and profitability, with a focus on sustainable growth and long-term value creation [27] Other Important Information - The company is investing in customer care, product development, and service level agreements to improve client experience and engagement [21] - Tax efficiency initiatives are running above expectations, reducing income tax charges and optimizing the tax structure [20] - The company is increasing its guidance for the year, reflecting strong performance in larger segments and new growth avenues such as cross-border transactions [23] Q&A Session Summary Question: Guidance Adjustment and P&L Impact [25] - The company adjusted its TPV guidance upwards by 10%, but net income guidance increased only 2%, reflecting higher financial expenses due to increased interest rates [26] - Management explained that the company is managing costs and balancing growth with profitability, despite higher-than-expected interest rates [27] Question: SG&A Expenses and Future Efficiency [29] - SG&A expenses increased due to higher marketing and personnel costs, but management expects these to stabilize in the second half of the year [30] - The company is investing in customer experience and product development, which is expected to drive higher client engagement and cross-selling [30] Question: LMEC Segment Growth and Profitability [34] - The LMEC segment grew 50% YoY, but margins are lower compared to the MSMB segment, though still accretive to the bottom line [35] - Management expects the LMEC segment to continue growing faster than the MSMB segment, driven by e-commerce and cross-border transactions [41] Question: Deposits and Credit Portfolio Growth [83] - Deposits grew 87% YoY, but the loan-to-deposit ratio remains low at 8%, with management focusing on growing the credit portfolio, particularly in working capital and overdraft products [83] - The company expects the credit portfolio to become more balanced between retail and wholesale loans in the future [87] Question: CapEx and Future Investments [91] - CapEx is running above guidance at BRL 2.4 billion annualized, with investments focused on technology and product development rather than POS [92] - Management expects CapEx to stabilize in the coming quarters, with a focus on supporting business expansion and future growth [92] Question: Gross Profit Margin and Funding Costs [94] - Gross profit margin as a percentage of TPV declined by 11 basis points, partly due to the growth of the LMEC segment and the mix of products such as PIX [95] - The company is exploring alternatives to reduce funding costs, with no specific target for cost versus CDI, but a focus on diversifying funding sources [98]

PagSeguro Digital Ltd. (PAGS) came out with quarterly earnings of $0.32 per share, beating the Zacks Consensus Estimate of $0.31 per share. This compares to earnings of $0.26 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 3.23%. A quarter ago, it was expected that this company would post earnings of $0.30 per share when it actually produced earnings of $0.33, delivering a surprise of 10%. Over the last four quarters, the com ...

PAGS's full-year Zacks Consensus Estimates are calling for earnings of $1.44 per share and revenue of $3.15 billion. These results would represent year-over-year changes of +32.11% and -1.63%, respectively. We can also see that PAGS currently has a PEG ratio of 0.56. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As the market closed yesterday, the Financial Transaction Services industry was having an average PEG r ...

Heading into today, shares of the company had gained 22.33% over the past month, outpacing the Business Services sector's gain of 0.5% and the S&P 500's gain of 4.43% in that time. The investment community will be paying close attention to the earnings performance of PagSeguro Digital Ltd. in its upcoming release. It is anticipated that the company will report an EPS of $0.35, marking a 34.62% rise compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly ...

Loading... Shares of PagSeguro Digital Ltd PAGS were trading down on Wednesday. The PagSeguro Digital Analyst: Tito Labarta upgraded the rating for PagSeguro Digital from Neutral to Buy, while keeping the price target unchanged at $15. Check out other analyst stock ratings. The pending privatization of Cielo "may create further opportunities" for StoneCo Ltd STNE and PagSeguro Digital to gain share, he added. PAGS Price Action: Shares of PagSeguro Digital had declined by 0.13% to $11.16 at the time of publi ...

Investment Thesis I recommend buying PagSeguro (NYSE:PAGS) shares after the 1Q24 results released on May 23rd. As a growth company, PagSeguro delivered a great annual increase of 31.7% in net income. Another highlight is that the company reported that it reached 31.4 million customers, of which 17.3 million are active customers. Furthermore, the company is growing in low-risk and profitable products, while launching new and promising products, something important when operating in a sector characterized by ...

PagSeguro Digital Ltd. (PAGS) came out with quarterly earnings of $0.33 per share, beating the Zacks Consensus Estimate of $0.30 per share. This compares to earnings of $0.23 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 10%. A quarter ago, it was expected that this company would post earnings of $0.29 per share when it actually produced earnings of $0.33, delivering a surprise of 13.79%. Over the last four quarters, the co ...

TPV reached 112 billion BRL (+27% YoY), more than twice the industry's growth and 31 billion BRL in deposits, reinforcing the balance sheet for expansion of receivables anticipation and credit concession. SÃO PAULO, May 24, 2024 /PRNewswire/ -- PagBank (NYSE: PAGS), a complete digital bank in financial services and payments solution and one of the largest digital banks in Brazil, announces its results for the first quarter of 2024 (Q124). The main highlights of the period include a record recurring net prof ...