DLocal Limited (DLO) shares jumped almost 24% in Wednesday’s extended trading session after the company delivered blowout debut second-quarter results since its IPO in June this year.
The beat was primarily attributable to a rebound in the performance of DLocal’s enterprise merchants across major industries, which were negatively impacted by the COVID-19 outbreak in the prior-year quarter.
Shares of the payments platform operator that empowers local payments in emerging markets have gained over 50% since its IPO in June. Currently, the company has a $14.43 billion market capitalization. (See DLocal stock charts on TipRanks)
Adjusted earnings of $0.06 per share doubled year-over-year and beat analysts’ expectations of $0.05 per share in Q2. The company reported earnings of $0.03 per share in the prior-year period.
Markedly, revenues jumped 186% year-over-year to $59 million and significantly exceeded consensus estimates of $40.51 million. The increase in revenues reflected a surge in total payment volume, which increased 319% to $1.5 billion.
On top of this, adjusted EBITDA margin grew 384 bps to 44% during the quarter.
DLocal CEO Sebastian Kanovich commented, “Our singular focus is on making the complex simple, redefining the online payments experience in emerging markets.”
Kanovich further added, “Through one direct API, one technology platform, and one contract, which we collectively refer to as the One dLocal model, we enable global enterprise merchants to get paid (pay-in) and to make payments (pay-out) online in a safe and efficient manner.”
New Street analyst Soomit Datta recently initiated coverage of DLocal with a Hold rating and a price target of $50 (1.5% upside potential)
Overall, the stock has a Hold consensus rating based on 2 Buys and 6 Holds. The average DLocal price target of $50.88 implies 3.25% upside potential from current levels.
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