DLO: What's the Difference?
A while back, we asked a simple question about $DLocal Limited(DLO)$ to so-called FinTwit "experts" heading into an earnings release. Well, DLO is announcing earnings on Wednesday after market close, so we'll pose the same question ... "what makes this stock so great now versus before ... why is this time different?".
The response from Rose Celine Investments was dismissive — basically telling us that if we were asking, we shouldn’t own the stock. That’s not analysis. It’s a deflection. The market has repeatedly signaled skepticism, and any responsible analysis should try to understand why, not rudely dismiss someone for asking a valid question.
Since 2023, DLO has had multiple rallies into $17–$20, each followed by a sharp sell-off — and the current pullback toward ~$11 confirms that our caution about the longer-term outlook was warranted in asking Rose what has changed. The daily chart makes this pattern very clear.
Looking at the fundamentals gives clarity:
• TPV growth has been extremely strong: FY2024 TPV $25.6B (+45% YoY) vs revenue $746M (+15% YoY) • Q3 2025 TPV $10.4B (+59% YoY) vs revenue $282.5M (+52% YoY)
Volume growth outpaces revenue, signaling take-rate pressure.
Margins and take rates show stress:
• Gross profit margins fluctuating: 37% in Q3 2025 vs ~42% previously • Q1 2025 TPV grew 53% while revenue grew 18%
This is exactly what markets look at when assessing durability of monetization.
Asking “what’s materially different now?” wasn’t a red flag — it was the right question. And the current price action, back down near $11, confirms that our caution about the longer-term outlook was warranted in asking Rose what has changed.
Until take rates stabilize, margins improve consistently, and growth translates into durable profitability, the market’s behavior makes perfect sense.
Price action is telling the story the headlines or so-called “experts” don’t fully capture.
Investors are waiting for sustained evidence that the economics can support higher multiples. Until then, price action does not lie — it often reveals what the market still doubts about the fundamentals. If the bull case has fundamentally changed since 2023, the price action should reflect it. And yet, here we are back at 11.
So, how are we going to trade DLO for earnings?
We're thinking of taking this Optionselling put-write trade:
- March 20 or April 17 expiry laddering the 8, 9 and 10 put strikes
This is a volume trade, meaning that we'd be writing a lot of contracts in order to get a decent payout since the premium is low. We'll do a few contracts at the 10 strike and the majority of the position at the 8 and 9 strikes.
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