Is StoneCo (STNE) a Convincing Buy for 2025? A Deep Dive into Analyst Ratings vs. Earnings Revisions

In the volatile world of fintech investing, StoneCo (STNE) has emerged as a polarizing asset. As 2025 unfolds, the question of whether STNE is a convincing buy hinges on a critical debate: Do Wall Street analyst ratings or earnings estimate revisions offer a more reliable guide for investors? This analysis examines both metrics through the lens of StoneCo's recent performance, historical trends, and empirical research.

The Analyst Rating Landscape: Optimism vs. Historical Volatility

Wall Street analysts have consistently leaned bullish on StoneCo. As of Q3 2025, 12 analysts assigned a “Moderate Buy” consensus rating, with 8 “Buy” and 2 “Strong Buy” ratingsStoneCo (STNE) Stock Forecast and Price Target 2025^[2]. The average 12-month price target of $16.56 implies a 7.53% downside from the current price of $17.91Earnings Estimates Rising for StoneCo (STNE): Will It Gain?^[5]. However, this optimism contrasts sharply with StoneCo's five-year stock performance: a staggering -66.28% total return since 2020StoneCo (Nasdaq:STNE) - Stock Analysis^[1].

This disconnect raises questions about the reliability of analyst ratings. While StoneCo has beaten EPS estimates 100% of the time over the past 12 months—outperforming its industry average of 67.13%Breaking Down StoneCo Ltd. (STNE): Key Insights for Investors^[6]—its revenue growth (29.4% annualized) has not translated into sustained stock appreciation. Analysts' vested interests, as noted in academic studies, may skew their recommendationsAnalysts' Earnings per Share Forecasts: The Effects of ...^[4]. For instance, StoneCo's average brokerage recommendation (ABR) of 1.67 (on a 1–5 scale) reflects a “Strong Buy” bias from 77.8% of nine firmsStoneCo (STNE) Stock Forecast and Price Target 2025^[2], yet its stock remains volatile.

Earnings Estimate Revisions: A Stronger Predictor?

Empirical research suggests that earnings estimate revisions are more closely correlated with near-term stock price movements than analyst ratingsEarnings Estimates Rising for StoneCo (STNE): Will It Gain?^[5]. For StoneCo, this dynamic appears to hold true. Over the past 30 days, Q3 2025 EPS estimates have seen three upward revisions and two downward adjustmentsStoneCo (STNE) Stock Forecast and Price Target 2025^[2], reflecting a nuanced view of the company's operational health. The Zacks Consensus Estimate for current-year earnings has even increased by 14.29% due to recent positive revisionsEarnings Estimates Rising for StoneCo (STNE): Will It Gain?^[5], earning StoneCo a Zacks Rank #1 (Strong Buy) designationStoneCo (STNE) Stock Forecast and Price Target 2025^[2].

StoneCo's Q1 2025 earnings report exemplifies this link: The company exceeded the consensus estimate by 15.6% ($0.37 vs. $0.32), driving a 14.9% stock price surgeAnalysts' Earnings per Share Forecasts: The Effects of ...^[4]. Similarly, Q2 2025 results surpassed expectations by 8.33%StoneCo Ltd. (STNE) Beats Q2 Earnings and Revenue^[3], reinforcing confidence in its ability to outperform. These revisions, rather than static analyst ratings, may better capture StoneCo's evolving fundamentals, such as its 30% year-over-year growth in MSMB payments clientsBreaking Down StoneCo Ltd. (STNE): Key Insights for Investors^[6].

The Case for Caution: Debt and Market Realities

Despite these positives, StoneCo's financial leverage remains a concern. Its Q4 2024 debt-to-equity ratio of 109.51%Breaking Down StoneCo Ltd. (STNE): Key Insights for Investors^[6] underscores the risks of its aggressive expansion strategy, including securitization of $3.3 billion in receivablesBreaking Down StoneCo Ltd. (STNE): Key Insights for Investors^[6]. While Wall Street analysts highlight its 19.34% projected Q3 2025 earnings growthStoneCo (STNE) Stock Forecast and Price Target 2025^[2], investors must weigh this against the company's history of earnings declines (-3.1% annualized over five years)StoneCo (Nasdaq:STNE) - Stock Analysis^[1].

Moreover, the wide dispersion in price targets—from $6.00 to $25.00Earnings Estimates Rising for StoneCo (STNE): Will It Gain?^[5]—reflects deep uncertainty about StoneCo's long-term valuation. This volatility is compounded by macroeconomic headwinds, such as rising interest rates, which could pressure its debt-heavy balance sheet.

Conclusion: A Calculated Bet for 2025

StoneCo's investment case for 2025 rests on a delicate balance. While Wall Street analysts remain overwhelmingly bullish, their historical accuracy in predicting STNE's stock price is questionable. In contrast, earnings estimate revisions—particularly the recent upward trends and consistent EPS outperformance—offer a more actionable signal for near-term optimism.

For investors, the key is to prioritize earnings momentum over ratings while hedging against StoneCo's structural risks. A Zacks Rank #1 (Strong Buy) and 68.3% year-to-date stock gainStoneCo Ltd. (STNE) Beats Q2 Earnings and Revenue^[3] suggest short-term potential, but the 5-year -66.28% total returnStoneCo (Nasdaq:STNE) - Stock Analysis^[1] serves as a stark reminder of the company's volatility. Those with a high-risk tolerance and conviction in StoneCo's fintech ecosystem may find STNE a compelling, albeit speculative, addition to their 2025 portfolios.