NU changes
Pick any two versions below to diff them.
- Price
- $11.61 → $12.08(+4.0%)
- Discount category
- Well below intrinsic value → Below intrinsic value
- Next earnings is estimate
- Yes → No
- Thesis
- The market prices Nu Holdings for Brazil risk, for credit risk in a fast-growing unsecured loan book and for the cost of its expansion outside Brazil. Most of its customers and profit are in Brazil, and Brazilian stocks and the real fell sharply on October 26, 2026, after the presidential runoff, according to press reports. Nu reports in US dollars, so a weaker real lowers its reported profit. The credit portfolio grew 37% in a year to $39.4 billion, and Nu said that it expands into higher-risk segments on purpose. Loans more than 90 days overdue were 6.9% in Q2 2026. Nu also spends on Mexico, Colombia and the United States. For the gap to close, three things must be true. Net income must keep growing, after a record of $1.1 billion in Q2 2026, with a return on equity near 30%. The 15 to 90 day delinquency ratio must stay near its normal seasonal range, after 4.8% in Q2 2026. Mexico and the new markets must move toward profit without large losses. The Q3 2026 removed: report, expected added: report on removed: about November 12, 2026, and the first Investor Day on December 8, 2026, give the next tests. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is a credit cycle or a currency crisis in Brazil.
- Checkpoints
- Nov 12, removed: 2026 (estimate): added: 2026: Q3 2026 results: profit and credit quality. Pending. Watch: Net income above the $1.1 billion of Q2 2026 and a stable 15 to 90 day delinquency ratio pass; a fall in net income or a sharp rise in delinquency fail. Dec 8, 2026: First Investor Day: long-term targets. Pending. Watch: Clear long-term targets for growth, returns and the path to profit in Mexico and the United States pass; vague targets or a much higher spending plan fail.