DLocal Limited (NASDAQ:DLO) is a global payments platform that’s quietly becoming a fintech force across emerging markets. And with its forward P/E of 13.23, PEG ratio of just 0.62, and a remarkably low debt to equity ratio of 0.01 as of June 13, the stock screams undervalued. Trading under $20, DLocal is a compelling pick for investors seeking growth at a reasonable price.
The company’s Q1 2025 results show why it's worth watching. Total Payment Volume (TPV) surged to $8.1 billion, up 53% year over year, or an even more impressive 72% in constant currency. This was DLocal’s second consecutive quarter with TPV growth above 50%, a testament to the strength of its platform and merchant relationships. In fact, its net retention rate hit 144%, highlighting how existing customers are spending more through the platform.
Revenue came in at $217 million, a year over year jump of 18% (36% in constant currency), while gross profit soared to $85 million, up 35% year over year. The company also maintained strong operating discipline, with an adjusted EBITDA to gross profit ratio of 68%, underscoring its ability to scale profitably.
One of DLocal Limited (NASDAQ:DLO) greatest strengths is its geographic and sectoral diversification. From Latin America to Africa and Asia, the company’s cross border payments are booming, driven by sectors like remittances, streaming, and e-commerce. Key partnerships with global platforms like Temu, Zepz, and Rappi are driving growth across 15+ markets.
Behind the scenes, DLocal Limited (NASDAQ:DLO) is also innovating with AI and automation. Smarter fraud detection, improved conversion rates, and faster merchant onboarding are just some of the ways it's enhancing performance. These investments are expected to reduce hiring needs and boost long term efficiency.
With robust financials, strong free cash flow (85% conversion), and accelerating global expansion, DLocal Limited (NASDAQ:DLO) is checking all the boxes. For under $20 a share, it’s a rare fintech with real growth, solid margins, and upside potential, exactly the kind of stock that belongs in any undervalued growth portfolio.
Check the Complete list here: 7 Best Undervalued Stocks to Buy Now Under $20