NU Stock Recent News

Nu Holdings is a rapidly growing, profitable fintech with a strong presence in Brazil, Mexico, and Colombia, offering a unique buying opportunity due to its undervaluation. The platform's customer base grew 22% Y/Y to 114M in Q4'24, with potential to reach 340M customers by the end of the decade. I like the Company's focus on the dynamic Latin American market, strong customer growth, and improving monetization.

Strategy (MSTR -10.60%), the tech company formerly known as MicroStrategy, currently has a market cap of $75 billion. It was valued at just $3 billion two years ago.

The latest trading day saw Nu Holdings Ltd. (NU) settling at $11.09, representing a +1.56% change from its previous close.

Nu Holdings Ltd. offers a compelling entry point due to its significant growth potential in Latin America and recent stock dip. When looking past currency fluctuations, the digital bank achieved 50% revenue, highlighting strong underlying performance. Nu Holdings' low-cost structure and profitability, with $2 billion net income and efficient customer acquisition, underscore its financial strength.

Nubank's core financial services segment is performing well, as revenues and margins continue to grow off the back of efficient user acquisition and deepening monetization. NU's potential to evolve into a super app by leveraging its brand in new markets like e-commerce, travel, and cellular services, could drive higher growth for the long term. The company's valuation is compelling, with forward multiples suggesting significant upside potential, making it an attractive investment opportunity.

Despite having a market cap of more than $50 billion, Nu Holdings (NU -4.17%) might not be a familiar business to many investors in the U.S. That's because its operations are in Brazil, Mexico, and Colombia.

Investing in Brazilian stocks, like Nu Holdings, requires vigilance due to macroeconomic volatility and the necessity of managing risk and margin of safety. Nu Holdings, despite trading at premium multiples, offers strong growth potential with high ROE and expanding market share in Brazil and Latin America. Risks include high-interest rates, potential regulation changes, and a high-risk credit portfolio, which could impact ROE and overall financial performance.

Nu Holdings continues to grow rapidly with 114 million customers, but recent financial results were disappointing due to rising credit losses and currency depreciation. The 7% delinquency rate has raised investor concerns about risk management amid aggressive loan expansion. A sharp fall in the Brazilian Real hurt USD-reported results, though Brazil's economy remains fundamentally strong.

A weakening Brazilian Real has paused the positive momentum of Nu Holdings. Nonetheless, Nu keeps performing excellently by growing customers, revenue, and profit margins. The valuation looks attractive considering the growth trajectory that's ahead with a PEG ratio at 0.3x.

Nu Holdings missed revenue expectations in Q4, with slower customer growth and slight profitability declines. FX headwinds were a major factor, impacting net interest margins and ARPAC. Nu Holdings still has lots of growth ahead, with a less-than-4% market share and a relatively underbanked population in Latin America. Despite short-term issues, Nu maintains a 32% adjusted annualized ROE and has ample capital to deploy, which can help support ROE and net interest margins over time.