Key Takeaways:
- Scale Milestone: dLocal hit a massive milestone in Q3, processing over $10 billion in total payment volume (TPV) for the first time.
- Price Projection: Based on current growth trajectory and margin stabilization, the stock has a target of $28.5 by December 2027.
- Potential Gains: This target implies a total return of 100% from the current estimated price level of $10.
- High Loyalty: The company boasts a 149% Net Revenue Retention, meaning existing customers spent 49% more this year than last.
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dLocal (DLO) is the “hidden engine” behind global commerce in emerging markets.
If a massive tech giant like Amazon or Google wants to sell products in Brazil, Nigeria, or Egypt, they face a problem: local customers don’t always use Visa or Mastercard.
dLocal solves this by providing a single platform that connects global brands to hundreds of local payment methods.
In the third quarter of 2025, dLocal’s revenue jumped 52% to $282 million. Even more impressive was the profit growth, with adjusted EBITDA reaching $72 million.
With a market cap of $4.1 billion, dLocal is a mid-cap stock offering significant upside potential for shareholders.
See analysts’ full growth forecasts and estimates for dLocal stock (It’s free) >>>
What the Model Says for dLocal Stock
We analyzed the upside potential for dLocal stock by looking at its expansion into new countries and its new financial products. The company doesn’t just process payments; it now offers “local-to-local” transactions and “Buy Now, Pay Later” (BNPL) services.
Our model projects the stock will climb to $28.53 within 24 months. This is based on a forecast of 32% annual revenue growth and 22% operating margins.
We applied a 15x price-to-earnings (P/E) multiple. This is a very conservative estimate, considering the company’s five-year average P/E is actually much higher at 44x.
Our Valuation Assumptions
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Our Valuation Assumptions
TIKR’s Valuation Model lets you plug in your own assumptions for a company’s revenue growth, operating margins, and P/E multiple, and calculates the stock’s expected returns.
Here’s what we used for dLocal stock:
1. Revenue Growth: 32%
dLocal is growing in two ways: it’s expanding into new countries and securing more revenue from existing clients.
- Unrivaled Stickiness: The company has a “Net Revenue Retention” rate of 149%. This means that even if they didn’t sign a single new client, their revenue would grow by nearly 50% just because their current customers (including six of the “Magnificent Seven” tech giants) are using the platform more.
- Global Diversification: Brazil is still their biggest market, but countries like Nigeria, Bolivia, and Colombia are growing even faster. This spreads out the risk. If one country’s economy struggles, the others pick up the slack.
- Higher Conversion: In Peru, dLocal introduced a way to save local payment info (tokenization). This simple tech upgrade boosted successful payment rates by 34%, making it an essential tool for merchants.
2. Operating margins: 22%
dLocal is built to be a “profit machine” as it scales.
- Low Costs to Grow: The company has a 90% gross margin. Once they build the digital pipes to a new country, adding more transactions costs them almost nothing.
- Smart New Products: They recently launched a BNPL service. Instead of lending the money themselves (which is risky), they partner with local banks and take a fee. This allows them to earn higher margins without the risk of borrowers defaulting on their loans.
- Operational Discipline: While they are hiring more sales and tech staff, they are doing it carefully. Currently, 70% of their gross profit turns into adjusted EBITDA, showing high efficiency.
3. Exit P/E Multiple: 15x
A P/E multiple tells you how much investors pay for $1 of profit. Currently, dLocal trades at about 17.8x.
- Building a Moat: It is incredibly difficult to do what dLocal does. A competitor would have to spend years getting licenses and connecting to local banks in 40 different countries. This “moat” protects dLocal’s profits.
- The Trend is Their Friend: By 2027, local payment methods (such as digital wallets and local bank transfers) are expected to account for 60% of e-commerce in these markets. dLocal is the primary gateway for these payments.
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What Happens If Things Go Better or Worse?
Emerging markets can be unpredictable. Here is how DLO might perform in different scenarios:
- Low Case: If growth slows to 24% and margins shrink, the stock could still deliver a 24% annual return, reaching roughly $22.
- Mid Case: With 32% growth and 22% margins, we expect a 34% annual return.
- High Case: If their new stablecoin and BNPL products take off, returns could exceed 44% annually, pushing the price toward $62.
See what analysts think about dLocal stock right now (Free with TIKR) >>>
dLocal is a rare find: a high-growth tech company that is already highly profitable. While emerging markets are volatile, dLocal’s massive “moat” and its relationships with the world’s biggest companies make it a powerhouse in the payments space.
How Much Upside Does dLocal Stock Have From Here?
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
