Payments investors looking beyond the largest networks face two different choices — Priority Technology Holdings, Inc. PRTH and DLocal Limited DLO. Priority is building a U.S.-focused commerce platform that combines merchant acquiring, payables and treasury tools. dLocal helps global companies collect payments, send payouts and settle funds across emerging markets through one connection. Both businesses benefit as payments become more digital and companies seek fewer vendors, better data and smoother money movement. Yet, their growth engines and financial profiles differ. Priority is expanding from traditional merchant processing into higher-value treasury and payables services, while dLocal is scaling cross-border infrastructure across more than 60 countries. Results in recent quarters support both stories, but they also highlight different risks. Priority carries substantial debt and has slower card-volume growth. dLocal is growing much faster, though its take rate and margins can move with country, merchant and payment-method mix. The better choice depends on growth quality, balance sheet strength, execution and price.The Case for PRTHPriority’s main strength is the breadth of its platform. Its Commerce Engine combines merchant acceptance, automated payables, banking and treasury services, letting customers collect, store, lend and send money through one relationship. That approach can deepen customer ties and reduce reliance on basic card processing, where competition and pricing pressure remain persistent.The business mix is improving. Payables and Treasury Solutions produced 63% of adjusted gross profit in the first quarter, and recurring revenues also represented 63%. Payables revenues rose 36%, while Treasury Solutions revenues increased 17%, showing that Priority’s faster-growing units are becoming more important.Priority is also finding practical ways to expand. The Pittsburgh Steelers partnership combines ticketing payment processing with Passport treasury orchestration, offering a clear example of cross-selling payments and cash-management tools. Compared with dLocal’s international network, Priority’s opportunity is centered on adding products and vertical solutions within its U.S. ecosystem for customers and partners alike. Still, the merchant business remains mixed. Card volume grew only 2.5%, average merchant accounts declined, and management expects low-single-digit organic volume growth. Acquisitions supported reported growth, so investors should separate purchased expansion from organic momentum.The largest restraint is financial leverage. Priority ended March with about $928 million of net debt and a 4.0 times net leverage ratio. Free cash flow and planned debt reduction can improve that position, but interest costs limit flexibility. Priority offers a credible platform story, though slower core growth and a leveraged balance sheet argue for patience rather than a stronger stance today.The Case for DLOdLocal offers a more direct growth case. Its platform gives global merchants one API, one contract, and one connection for accepting payments, making payouts and settling funds in emerging markets. That solves a difficult problem because each country can have payment methods, regulations, currencies, banks and consumer habits. Its scale is expanding rapidly. First-quarter total payment volume reached $14.1 billion, up 73% year over year, while revenues rose 55%, and gross profit increased 40%. These numbers indicate that merchants increasingly want local processing and wider emerging-market coverage. Compared with Priority, dLocal has a narrower strategic focus but a wider geographic runway. Priority is assembling financial tools around U.S. customers, while dLocal is extending a cross-border network across Africa, Asia, the Middle East and Latin America. More countries, payment methods and merchant relationships can make the network harder to replicate.However, there are risks. Gross profit as a percentage of payment volume declined as dLocal added large merchants, new methods and lower-take-rate volume. Operating expenses also rose quickly, and first-quarter free cash flow was reduced by working-capital timing. Investors should expect uneven margins as the mix changes. Even so, dLocal’s balance sheet gives it room to invest through those swings. Corporate cash reached about $452 million, and normalized net income still grew 11%. Its addition to the Russell 2000 may improve visibility and liquidity, though that is not an operating catalyst. With faster growth, strong cash resources and a large market opportunity, dLocal presents the more attractive long-term setup.How Do Estimates Compare for PRTH & DLO?The Zacks Consensus Estimate for Priority’s 2026 and 2027 sales implies year-over-year growth of 8.47% and 6.14%, respectively. The consensus mark for 2026 and 2027 EPS suggests a year-over-year increase of 20.39% and 16.94%, respectively. Over the past 60 days, estimates for PRTH’s 2026 and 2027 EPS have remained unchanged. For Priority:Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for dLocal’s 2026 and 2027 sales calls for year-over-year growth of 38.34% and 25.48%, respectively. The consensus estimate for 2026 EPS has been revised upward over the past week, while the same for 2027 has been kept unchanged. The figures suggest a year-over-year increase of 2.50% and 31.30%, respectively.For DLocal:Image Source: Zacks Investment ResearchPrice Performance and Valuation of PRTH & DLOSo far in the year, Priority shares have rallied 17.6%, while dLocal shares have risen 6.6%. In comparison, the S&P 500 composite has advanced 8.2% in the same time frame. Image Source: Zacks Investment ResearchPRTH is trading at a forward price-to-sales of 0.51X, which is above its one-year median of 0.47X. Meanwhile, DLO is presently trading at a forward price-to-sales of 2.54X, which is below its one-year median of 2.87X. PRTH has a Value Score of A, while DLO has a Value Score of B.Priority therefore looks cheaper, reflecting slower organic growth, high debt and interest costs. dLocal’s premium reflects faster volume, revenues and gross-profit expansion, plus stronger cash resources.Image Source: Zacks Investment ResearchConclusionPriority and dLocal both have credible paths to benefit from digital payments, but they offer different trade-offs. Priority’s commerce platform, improving revenue mix and treasury growth deserve recognition. However, modest card-volume growth and substantial leverage reduce its room for error and make the shares better suited to investors already positioned, while debt declines. dLocal carries mix and execution risks, yet its much faster payment-volume growth, expanding emerging-market network, healthy cash position and stronger financial flexibility create a better risk-reward balance. Between the two, dLocal is the stock to consider adding, while Priority is best kept without increasing exposure for now.DLO has a Zacks Rank #2 (Buy), while PRTH carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Zacks' Research Chief Names "Stock Most Likely to Double" Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest. This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.Free: See Our Top Stock And 4 Runners UpThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment Research
