According to a bullish thesis on PagSeguro Digital Ltd. by KraticCapital, PAGS shares were trading at $10.43 on January 12th, with trailing and forward P/E ratios of 7.69 and 6.98 respectively. The Brazilian fintech, founded in 2006, provides payment processing and digital banking services with strong historical growth potential.

With net income and revenue CAGRs of 15% and 27% from 2018-2024, PagSeguro Digital Ltd. trades at a P/E of around 7 and near book value, showcasing a wide margin of safety. The company’s profitability is tied to Brazilian interest rates, with potential for increased pre-tax profits with expected rate cuts in 2026.

Despite competition risks and fee repricing, PagSeguro Digital Ltd. benefits from a strong capital position, strategic backing, and growth potential in both payment processing and digital banking. The stock offers a compelling risk/reward opportunity with undervaluation, capital returns, macro tailwinds, and growth potential through 2029.

A previous bullish thesis on PagSeguro Digital Ltd. by The ROI Club in November 2024 highlighted its capital-light model, strong ROIC, digital payments growth, and expanding credit portfolio. The stock has appreciated approximately 23.87% since coverage, with a similar view shared by KraticCapital emphasizing interest rate sensitivity, cash position, and PIX-related risks.

Read more at Yahoo Finance: PagSeguro Digital Ltd. (PAGS): A Bull Case Theory