Why PagSeguro Digital Stock Soared Almost 13% Higher Today

There's nothing like an unexpected payout to juice interest in a stock. The market was clearly caught a little off guard by PagSeguro Digital's (NYSE: PAGS) announcement of a special cash dividend, and it reacted accordingly. Investors piled into the Brazilian fintech to the point where it closed the day nearly 13% higher, a far better improvement than the under 1% gain posted by the S&P 500 index.

A special announcement

That morning, PagSeguro announced that it will pay its stockholders $0.12 per each of its common shares as a special dividend. This is to be dispensed on Aug. 15 to investors of record as of July 16.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Image source: Getty Images.

That's only the first in a series -- the company added that it aims to make two additional special dividend payouts. These should match that $0.12 per share distribution and be paid within the coming three quarters.

Dividends have been a theme for PagSeguro lately. The company, which went public on the U.S. market at the start of 2018, declared its first regular dividend in mid-May. This amounts to $0.14 per share and was paid out to stockholders earlier this month.

Like the inaugural special dividend, this isn't intended to be a one-off. PagSeguro said that it aims to pay an annual dividend every year corresponding to roughly 10% of its distributable net income.

Quite the shareholder-pleasing measure

The Brazilian fintech space certainly has vast room to grow, given the cutting-edge offerings of PagSeguro and its peers in the vast yet under-banked country.

The company's new(ish) dividend policy adds to the attractiveness of the stock, which has already been bolstered by solid financial performance -- even if the company's first quarter was considered by some to be lackluster -- and consistent profitability.

Should you invest $1,000 in PagSeguro Digital right now?

Before you buy stock in PagSeguro Digital, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and PagSeguro Digital wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $653,702!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $870,207!*

Now, it’s worth noting Stock Advisor’s total average return is 988% — a market-crushing outperformance compared to 172% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 9, 2025

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool recommends PagSeguro Digital. The Motley Fool has a disclosure policy.