# Totvs (TOTS3.SA)

Canonical: https://gigainvestors.com/s/TOTS3.SA

Analysis as of: 2026-10-16T07:37:51.917Z. Financial observations: FY2002–FY2025.

Listing currency: BRL. Reporting currency: BRL.

## Verdict

A wonderful business at too high a price

Quality tests for Buy: pass (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: BRL 39.91 per share; close as of 2026-10-15.

Estimated value: low BRL 16.37 per share, central BRL 20.65 per share, high BRL 22.09 per share. Buy at or below the central value BRL 20.65 per share. Valuation as of 2026-10-16T07:37:51.917Z; scenarios are not confidence intervals.

Expected annual return: 9.9% at the stated quote. About 9.9% a year at today's price (required return 17.0%). required return 17.0% a year (BR 10-year bond 13.0% + 4 points).

## Checklist

### understandable: pass

- 1 revenue decline in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 1

- Years with a net loss: 0

- Operating margin variation: 0.32×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.10×

- FY2017: 0.06×

- FY2018: 0.11×

- FY2019: 0.14×

- FY2020: 0.15×

- FY2021: 0.18×

- FY2022: 0.24×

- FY2023: 0.16×

- FY2024: 0.17×

- FY2025: 0.19×

### moat: pass

- ROIC, median of available years: 41.9%

- ROIC, second-lowest year: 19.8%

- Typical minus recent gross margin: -2.0 pp

- Typical gross margin (annual median): 68.3%

- Recent gross margin (lower of latest and 3-year median): 70.3%

- Years with nonpositive capital: 0

- Capital spending / revenue: 4.6%

- ROIC including acquisitions, ten-year median: 16.1%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 19.8%

- FY2017: 14.0%

- FY2018: 24.5%

- FY2019: 33.5%

- FY2020: 38.6%

- FY2021: >100%

- FY2022: >100%

- FY2023: >100%

- FY2024: 76.7%

- FY2025: 45.1%

### economics: pass

- Owner earnings / net income, 5-yr: 1.02×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: BRL 3.3B

- Net income, five-year total: BRL 3.2B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: -1.2 pp

- Working capital / revenue, change between three-year averages: -8.8 pp

- Working capital / revenue, final three-year average: 7.9%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 0.94×

- FY2022: 1.03×

- FY2023: 0.96×

- FY2024: 1.08×

- FY2025: 1.04×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 19.8% vs 76.7%

- Per-share earnings: 0.31 to 1.20 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 2.0%

- Ordinary dilution, 5-year annual growth: 0.8%

- Market cap gain: BRL 21B

- Cumulative retained earnings: BRL 1.4B

- Diluted shares, 10-year annual growth: 2.0%

- Diluted shares, 5-year annual growth: 0.8%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 18.6%

- Per-share value change: BRL 0.89

- Per-share value, starting three-year median: BRL 0.31

- Per-share value, ending three-year median: BRL 1.20

- Buybacks concentrated in cheaper years (correlation): 0.10

- Average buyback yield: 1.1%

- Buyback history: 5 years

- Debt-funded buybacks: No

- Acquisition spending: BRL 3.5B

- Cumulative net income, 10 years: BRL 4.0B

- ROIC, first three-year median: 19.8%

- ROIC, last three-year median: 76.7%

Chart: Earnings per share; fiscal year observations.

- FY2016: BRL 0.31

- FY2017: BRL 0.19

- FY2018: BRL 0.12

- FY2019: BRL 0.36

- FY2020: BRL 0.51

- FY2021: BRL 0.60

- FY2022: BRL 0.81

- FY2023: BRL 1.20

- FY2024: BRL 1.19

- FY2025: BRL 1.49

### accounting: pass

- Sloan accruals: -3.3%

- Receivables to sales index (DSRI): 1.11×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 6.9%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.35×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.76×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -4.4%

- FY2017: -9.5%

- FY2018: -15.0%

- FY2019: -3.8%

- FY2020: -1.5%

- FY2021: -0.6%

- FY2022: -3.9%

- FY2023: -2.5%

- FY2024: -4.7%

- FY2025: -3.3%

## Holders

## Price story

Price needs cash profits to grow 18% a year for ten years · sales +10.5%

Story as of 2026-10-16T10:00:09.527Z; price observation 2026-10-15.

Price needs cash profits to grow 18% a year for ten years

### Sales · FY2024–2025

sales +10.5%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: BRL 2.2B 

- FY2017: BRL 2.2B 

- FY2018: BRL 2.1B 

- FY2019: BRL 2.3B 

- FY2020: BRL 2.6B 

- FY2021: BRL 3.0B 

- FY2022: BRL 3.8B 

- FY2023: BRL 4.4B 

- FY2024: BRL 5.2B 

- FY2025: BRL 5.8B 

### Gross margin · FY2025

gross margin 70.3%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: 59.9% 

- FY2017: 54.6% 

- FY2018: 65.0% 

- FY2019: 67.4% 

- FY2020: 67.4% 

- FY2021: 69.1% 

- FY2022: 69.8% 

- FY2023: 70.6% 

- FY2024: 69.5% 

- FY2025: 70.3% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in software application; annual sales are BRL 5.8 billion.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2025: revenue 5771867000; grossProfit 4055541000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TOTS3.SA: TOTVS S.A. develops and sells management software, and productivity and collaboration platforms in Brazil and internationally. It offers an ERP platform, which integrates software management, social networks, real-time reporting, and other applications; business intelligence solutions comprising data integration; Fluig platform; and HR solutions, such as payroll, electronic point, social security and safety, and human capital management services. The company also provides implementation, consulting, advisory, maintenance services, e-commerce, and mobility solutions, as well as digital marketing solutions. In addition, it offers financial services, issuance, and credit card management services, including credit analysis and intermediation of financing requests. Further, the company is involved in investment and equity investment fund activities. It serves services, manufacturing, agribusiness, logistics, education, construction, healthcare, financial services, retail, legal, distribution, and hospitality industries. TOTVS S.A. was founded in 1983 and is headquartered in São Paulo, Brazil.

### Why customers stay

Margins ranged from 69.5% to 70.6% during 2023–25; it earns 41.9% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2023: grossProfit / revenue = 70.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2024: grossProfit / revenue = 69.5%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2025: grossProfit / revenue = 70.3%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); 10-year return on capital observations [[2016,0.19771926031480483],[2017,0.13977919607710954],[2018,0.24472261629056738],[2019,0.3351107262819183],[2020,0.38643032910910513],[2021,1.2037097215577623],[2022,1.4293025218384479],[2023,1.4300890942332802],[2024,0.767270184381892],[2025,0.4514085242898206]]; median 0.41891942669946286. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Can it raise prices

Kept about a 70% gross margin through 2022 cost inflation.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); Gross margin observations: [[2021,0.6913843762427317],[2022,0.6980517973957877],[2023,0.7062344905677204]]; range within 2 percentage points.

### Where the cash goes

Paid dividends in 10 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2016: growth capex 0; upkeep 105147000; owner earnings 179175000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2017: growth capex 0; upkeep 51387000; owner earnings 192488000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2018: growth capex 0; upkeep 82468000; owner earnings 99371000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2019: growth capex 0; upkeep 60383000; owner earnings 248178000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2020: growth capex 0; upkeep 85040000; owner earnings 369801000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2021: growth capex 0; upkeep 176190000; owner earnings 345110200. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2022: growth capex 0; upkeep 181123000; owner earnings 510749400. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2023: growth capex 0; upkeep 277200000; owner earnings 707364800. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2024: growth capex 0; upkeep 242328000; owner earnings 776170400. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); FY2025: growth capex 0; upkeep 257628000; owner earnings 923410400. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); Dividend observations: [[2016,141350000],[2017,76480000],[2018,51486000],[2019,49898000],[2020,108228000],[2021,143634000],[2022,140036000],[2023,412163000],[2024,265352000],[2025,357783000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 8.9% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); TOTS3.SA SharesStats.PercentInsiders = 8.929 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 18% yearly over ten years; actual growth was 13.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:37:51.917Z); Ten-year compound average after fade. Initial solved rate 0.3383096167281431. Price 39.91; FX 1; discount 0.1695; same compounder ten-year fade to terminal 0.03. FY2015 owner earnings/share 0.42522560010443694 → FY2025 1.5424979800252603. Closing-price date 2026-10-15.

## Monthly share-price history (BRL per share)

- 2016-10: BRL 9.61 per share

- 2016-11: BRL 7.14 per share

- 2016-12: BRL 7.98 per share

- 2017-01: BRL 8.66 per share

- 2017-02: BRL 8.41 per share

- 2017-03: BRL 9.21 per share

- 2017-04: BRL 9.23 per share

- 2017-05: BRL 10.02 per share

- 2017-06: BRL 10.01 per share

- 2017-07: BRL 9.96 per share

- 2017-08: BRL 10.31 per share

- 2017-09: BRL 10.39 per share

- 2017-10: BRL 10.81 per share

- 2017-11: BRL 10.05 per share

- 2017-12: BRL 9.92 per share

- 2018-01: BRL 10.79 per share

- 2018-02: BRL 10.14 per share

- 2018-03: BRL 9.56 per share

- 2018-04: BRL 10.62 per share

- 2018-05: BRL 9.31 per share

- 2018-06: BRL 9.03 per share

- 2018-07: BRL 9.78 per share

- 2018-08: BRL 8.84 per share

- 2018-09: BRL 8.33 per share

- 2018-10: BRL 8.33 per share

- 2018-11: BRL 9.62 per share

- 2018-12: BRL 9.01 per share

- 2019-01: BRL 11.04 per share

- 2019-02: BRL 12.10 per share

- 2019-03: BRL 13.08 per share

- 2019-04: BRL 14.79 per share

- 2019-05: BRL 13.13 per share

- 2019-06: BRL 14.62 per share

- 2019-07: BRL 16.13 per share

- 2019-08: BRL 17.92 per share

- 2019-09: BRL 19.20 per share

- 2019-10: BRL 20.71 per share

- 2019-11: BRL 21.51 per share

- 2019-12: BRL 21.46 per share

- 2020-01: BRL 24.82 per share

- 2020-02: BRL 23.61 per share

- 2020-03: BRL 15.52 per share

- 2020-04: BRL 19.67 per share

- 2020-05: BRL 20.06 per share

- 2020-06: BRL 23.09 per share

- 2020-07: BRL 25.77 per share

- 2020-08: BRL 28.79 per share

- 2020-09: BRL 27.03 per share

- 2020-10: BRL 26.93 per share

- 2020-11: BRL 26.68 per share

- 2020-12: BRL 28.65 per share

- 2021-01: BRL 28.33 per share

- 2021-02: BRL 31.30 per share

- 2021-03: BRL 28.86 per share

- 2021-04: BRL 31.02 per share

- 2021-05: BRL 34.39 per share

- 2021-06: BRL 37.56 per share

- 2021-07: BRL 35.27 per share

- 2021-08: BRL 39.50 per share

- 2021-09: BRL 36.10 per share

- 2021-10: BRL 32.76 per share

- 2021-11: BRL 31.69 per share

- 2021-12: BRL 28.64 per share

- 2022-01: BRL 29.07 per share

- 2022-02: BRL 33.05 per share

- 2022-03: BRL 36.38 per share

- 2022-04: BRL 31.97 per share

- 2022-05: BRL 28.37 per share

- 2022-06: BRL 23.26 per share

- 2022-07: BRL 26.37 per share

- 2022-08: BRL 28.55 per share

- 2022-09: BRL 29.35 per share

- 2022-10: BRL 33.16 per share

- 2022-11: BRL 30.86 per share

- 2022-12: BRL 27.62 per share

- 2023-01: BRL 30.07 per share

- 2023-02: BRL 27.29 per share

- 2023-03: BRL 28.16 per share

- 2023-04: BRL 25.66 per share

- 2023-05: BRL 28.76 per share

- 2023-06: BRL 29.98 per share

- 2023-07: BRL 29.57 per share

- 2023-08: BRL 27.74 per share

- 2023-09: BRL 27.00 per share

- 2023-10: BRL 25.31 per share

- 2023-11: BRL 33.31 per share

- 2023-12: BRL 33.69 per share

- 2024-01: BRL 31.52 per share

- 2024-02: BRL 30.69 per share

- 2024-03: BRL 28.38 per share

- 2024-04: BRL 27.54 per share

- 2024-05: BRL 28.72 per share

- 2024-06: BRL 30.43 per share

- 2024-07: BRL 27.75 per share

- 2024-08: BRL 29.97 per share

- 2024-09: BRL 28.56 per share

- 2024-10: BRL 29.84 per share

- 2024-11: BRL 27.46 per share

- 2024-12: BRL 26.75 per share

- 2025-01: BRL 34.06 per share

- 2025-02: BRL 34.96 per share

- 2025-03: BRL 33.37 per share

- 2025-04: BRL 37.62 per share

- 2025-05: BRL 42.21 per share

- 2025-06: BRL 42.21 per share

- 2025-07: BRL 43.61 per share

- 2025-08: BRL 43.10 per share

- 2025-09: BRL 45.93 per share

- 2025-10: BRL 44.37 per share

- 2025-11: BRL 42.80 per share

- 2025-12: BRL 42.08 per share

- 2026-01: BRL 44.57 per share

- 2026-02: BRL 37.84 per share

- 2026-03: BRL 34.94 per share

- 2026-04: BRL 31.86 per share

- 2026-05: BRL 33.07 per share

- 2026-06: BRL 28.70 per share

- 2026-07: BRL 31.06 per share

- 2026-08: BRL 35.45 per share

- 2026-09: BRL 33.43 per share

- 2026-10: BRL 42.05 per share

## Annual estimated value (BRL per share)

- FY2016: low BRL 3.93 per share, central BRL 4.96 per share, high BRL 5.33 per share

- FY2017: low BRL 3.03 per share, central BRL 3.19 per share, high BRL 3.37 per share

- FY2018: low BRL 3.07 per share, central BRL 3.22 per share, high BRL 3.40 per share

- FY2019: low BRL 4.63 per share, central BRL 4.77 per share, high BRL 4.93 per share

- FY2020: low BRL 4.31 per share, central BRL 4.83 per share, high BRL 5.07 per share

- FY2021: low BRL 8.03 per share, central BRL 8.65 per share, high BRL 8.97 per share

- FY2022: low BRL 8.62 per share, central BRL 8.91 per share, high BRL 9.25 per share

- FY2023: low BRL 10.80 per share, central BRL 11.20 per share, high BRL 11.66 per share

- FY2024: low BRL 10.42 per share, central BRL 10.92 per share, high BRL 11.50 per share

- FY2025: low BRL 13.76 per share, central BRL 17.36 per share, high BRL 18.57 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.