Stable Sea’s new partnership with DLocal (DLO) places stablecoin powered B2B payments at the center of the story, connecting blockchain rails with DLocal’s existing cross border infrastructure in more than 40 countries.

The new Stable Sea partnership arrives after a softer run in DLocal’s shares, with a 30 day share price return of an 11.29% decline and a year to date share price return of a 15.14% decline, even as the 1 year total shareholder return sits at 32.63% and the 3 year total shareholder return reflects a 13.44% decline, suggesting recent enthusiasm has cooled compared with the longer term picture.

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With DLocal’s shares weaker over the past quarter, and recent payments growth, new products and partnerships in focus, the key question is whether today’s valuation still underestimates the story or if the market already prices in future growth.

Most Popular Narrative: 33.1% Undervalued

With DLocal’s last close at $11.94 versus a widely followed fair value estimate of $17.85, the core narrative leans toward meaningful upside if its thesis holds.

dLocal's rapid expansion of its solution set (SmartPix for Pix, Buy Now Pay Later partnerships, stablecoin payment infrastructure) and continued onboarding of new alternative payment methods position it to benefit from accelerating digitization of payments in emerging markets, supporting sustained top-line growth and potential for higher take rates on new products, which is positive for revenue and gross margin.

Curious what kind of revenue curve, earnings lift, and future profit multiple need to line up for that fair value to make sense? The full narrative lays out a specific growth path, margin profile, and valuation anchor that go well beyond near term share price swings.

Result: Fair Value of $17.85 (UNDERVALUED)

However, that upside story can weaken quickly if revenue remains heavily tied to a small group of large merchants or if regulation in key markets tightens further.

Another Angle On Value

The narrative fair value of $17.85 suggests upside, but the current P/E of 20.6x tells a more mixed story. It sits above the US Diversified Financial industry at 17.8x, yet well below peers at 40.1x and a fair ratio of 19.1x, which raises the question: is this a cushion or a warning sign?

Next Steps

If this mix of upside potential and recent share price softness has you curious, it makes sense to review the numbers yourself and move quickly. To see what is currently driving optimism behind the story, take a close look at 4 key rewards.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.