By Teresa Rivas

Tariffs and trade threats are old news when it comes to Nu Holdings. The fintech stock should keep winning.

Nu Holdings is the owner of Brazil's Nubank, Latin America's largest financial-technology bank. The stock has gained more than 13% since Barron's highlighted it a year ago and had an even better 2025, rising more than 45% so far. Upbeat second-quarter earnings, delivered in August, certainly helped.

Top- and bottom-line results came in better than expected, and digging into the results showed more good news. While some figures are slowing from its white-hot growth phase, they're still impressive. New accounts jumped more than 17%, deposits rose 41%, and average revenue per active customer accelerated to $12.20 from $11.18 in the prior quarter.

The shares surged following the news, and reached fresh all-time highs in mid-September. They shouldn't stop there.

Digitally native Nubank caters to underbanked consumers in Brazil, Mexico, and Colombia. These consumers -- more than 122 million at last count -- are a rapidly increasing segment of the population, but not much of a priority for traditional banks. That has allowed Nubank to rapidly expand its customer base as incomes, economies, and digital transactions grow across the region.

It's clear that those services are in demand. Activity rates, or the percentage of total customers who are active in a given period, in the most recent quarter were at 83%, well above those at traditional banks.

That success leads Susquehanna analyst James Friedman to speculate that the company could continue going on the offensive. "My sense is we are growing closer to a period of global expansion for Nu as they templatize their expansion beyond Brazil and into Mexico to additional markets," he says. Friedman raised his target price to $17 following second-quarter results.

Even if Nu doesn't enter new markets in the region, metrics show that it's still winning in Brazil. It serves more than half of the country's adult population and is the nation's third-largest financial institution, with rapid uptake in Mexico and Colombia as well. There's also the opportunity to cross-sell other products, for example moving users who have online accounts and credit cards into loan products.

Of course, it hasn't all been smooth sailing for Nu: It is a volatile stock with variable results, and Warren Buffett's Berkshire Hathaway, a one-time shareholder, sold its stake in the company in the first quarter. The shares are sensitive to geopolitics too: Worries that U.S. tariffs would hurt Brazil, and that they could change on a whim from the White House, are an ongoing concern.

Still, the rapid transformation from a cash economy to a modern digital one should continue regardless of the broader macroeconomic backdrop.

In addition, earnings are still climbing at a rapid clip and the shares don't look too pricey. Even after this rally, Nu trades more cheaply than it did when Barron's first wrote about it on a forward earnings basis, with a price-to-earnings ratio of 18.4 times. After a period of cooling profit growth this year, consensus calls for earnings per share to soar nearly 28% in 2026.

In the end Nu's gains this year may put new shareholders off. That would be shortsighted. Shares are still cheap, especially with what looks like a solid path to higher profits -- regardless of new countries being added to the roster.

Shareholders can take that to the bank.

   -- Share your questions and thoughts in the "Conversation" section below to 
      engage directly with the author and our community 
 
   -- Receive alerts about more content from this author by clicking "Follow" 
      next to the author byline at top 
 
   -- Register for the live Q&A with the author of our most recent exclusive 
      stock pick here. 

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

By Teresa Rivas

Tariffs and trade threats are old news when it comes to Nu Holdings. The fintech stock should keep winning.

Nu Holdings is the owner of Brazil's Nubank, Latin America's largest financial-technology bank. The stock has gained more than 13% since Barron's highlighted it a year ago and had an even better 2025, rising more than 45% so far. Upbeat second-quarter earnings, delivered in August, certainly helped.

Top- and bottom-line results came in better than expected, and digging into the results showed more good news. While some figures are slowing from its white-hot growth phase, they're still impressive. New accounts jumped more than 17%, deposits rose 41%, and average revenue per active customer accelerated to $12.20 from $11.18 in the prior quarter.

The shares surged following the news, and reached fresh all-time highs in mid-September. They shouldn't stop there.

Digitally native Nubank caters to underbanked consumers in Brazil, Mexico, and Colombia. These consumers -- more than 122 million at last count -- are a rapidly increasing segment of the population, but not much of a priority for traditional banks. That has allowed Nubank to rapidly expand its customer base as incomes, economies, and digital transactions grow across the region.

It's clear that those services are in demand. Activity rates, or the percentage of total customers who are active in a given period, in the most recent quarter were at 83%, well above those at traditional banks.

That success leads Susquehanna analyst James Friedman to speculate that the company could continue going on the offensive. "My sense is we are growing closer to a period of global expansion for Nu as they templatize their expansion beyond Brazil and into Mexico to additional markets," he says. Friedman raised his target price to $17 following second-quarter results.

Even if Nu doesn't enter new markets in the region, metrics show that it's still winning in Brazil. It serves more than half of the country's adult population and is the nation's third-largest financial institution, with rapid uptake in Mexico and Colombia as well. There's also the opportunity to cross-sell other products, for example moving users who have online accounts and credit cards into loan products.

Of course, it hasn't all been smooth sailing for Nu: It is a volatile stock with variable results, and Warren Buffett's Berkshire Hathaway, a one-time shareholder, sold its stake in the company in the first quarter. The shares are sensitive to geopolitics too: Worries that U.S. tariffs would hurt Brazil, and that they could change on a whim from the White House, are an ongoing concern.

Still, the rapid transformation from a cash economy to a modern digital one should continue regardless of the broader macroeconomic backdrop.

In addition, earnings are still climbing at a rapid clip and the shares don't look too pricey. Even after this rally, Nu trades more cheaply than it did when Barron's first wrote about it on a forward earnings basis, with a price-to-earnings ratio of 18.4 times. After a period of cooling profit growth this year, consensus calls for earnings per share to soar nearly 28% in 2026.

In the end Nu's gains this year may put new shareholders off. That would be shortsighted. Shares are still cheap, especially with what looks like a solid path to higher profits -- regardless of new countries being added to the roster.

Shareholders can take that to the bank.

   -- Share your questions and thoughts in the "Conversation" section below to 
      engage directly with the author and our community 
 
   -- Receive alerts about more content from this author by clicking "Follow" 
      next to the author byline at top 
 
   -- Register for the live Q&A with the author of our most recent exclusive 
      stock pick here. 

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

October 14, 2025 09:17 ET (13:17 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.