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    Brazil Rally And Strong Earnings Could Reframe Nu Stock (NU)

    Simply Wall St·10/08/2026 23:47:05
    Listen to the news
    • Nu Holdings stated it is not pursuing an acquisition of UK digital bank Monzo after earlier reports of talks, and reiterated that its main focus remains Brazil, Mexico, Colombia and Nu Global.
    • Management is emphasizing organic growth and partnerships instead of a large UK buyout, which keeps execution centered on its Latin American banking model and recently reported net income of US$1.1b serving 139 million customers.
    • The focus now turns to how Nu Holdings' decision to step back from a Monzo takeover could influence its broader investment narrative.
    Spot fresh opportunities by comparing Nu Holdings' pivot away from Monzo with other fast growing fintechs screened for stronger balance sheets in our list of solid balance sheet and fundamentals (25 results).

    Nu Holdings Investment Narrative Recap

    For a shareholder in Nu Holdings, the core belief is simple. You need to think that its digital model can keep deepening engagement with 139 million customers while managing credit risk in unsecured loans and cards. The decision not to buy Monzo keeps attention on Brazil, Mexico, Colombia and Nu Global, so the main operational story still rests on disciplined expansion in those markets.

    Right now, the short term catalyst is execution on that Latin American growth, especially as Nu Holdings invests heavily in Mexico and scales newer products like Nu Global. The biggest risk remains asset quality and provisions on a high level of bad loans. The Monzo reversal removes a potential dilution and integration overhang but does not change that core risk.

    The most relevant piece of context for this Monzo news is Nu Holdings' second quarter net income of US$1.1b, serving 139 million customers. That print showed what the existing franchise can produce without a large UK bank in the mix. It anchors the current debate on whether management should prioritize internal execution or pursue big overseas deals.

    Recent share price moves have also been closely tied to Brazil's election driven rally and shifting sentiment toward business friendly policies. For you as an investor, that means the key near term catalysts are still local, from regulation and taxes in Brazil to the planned US$4.2b build out in Mexico. Credit quality, funding costs and how efficiently Nu Holdings deploys that capital matter more than any paused Monzo conversation.

    What The Nu Holdings Forecasts Assume

    Nu Holdings' current analyst script leans on some punchy numbers. The consensus setup assumes revenue expands at about 75.1% a year over the next three years. On those inputs, earnings are projected to reach US$8.2b by 2029, compared with US$3.6b today, even though profit margins in the model compress from 42.7% to 18.0% as the firm scales.

    That shift in profit mix matters for how you think about the Monzo decision. The earnings bridge from US$3.6b to US$8.2b implies roughly a 2.3x step up in profit, which analysts are tying to deeper monetization of Nu Holdings' existing Latin American base rather than a large UK acquisition. The forecast also incorporates a slightly lower P/E multiple, moving from 17.0x today to 14.8x on those 2029 earnings. This keeps the story grounded in execution rather than multiple expansion.

    Analysts also factor in a modest share count tailwind. Forecasts point to a 0.31% yearly decline in shares outstanding over the next three years, which means any earnings trajectory filters through a little more cleanly to per share figures. A discount rate of about 10.8% is being used to pull those future profits back into today's valuation. When you compare that to your own required return, you can stress test whether the risk profile lines up with your portfolio goals.

    Nu Holdings' narrative projects US$45.4b revenue and US$8.2b earnings by 2029, which implies 75.1% yearly revenue growth and about a 2.3x earnings increase from US$3.6b today.

    Discover how Nu Holdings' fair value indicates a 21% potential upside to its current price, a gap that may not last much longer.

    NYSE:NU 1-Year Stock Price Chart
    NYSE:NU 1-Year Stock Price Chart

    Exploring Other Perspectives

    Some of the most optimistic analysts were not just focused on Nu Holdings' Latin American expansion. They were excited about a potential UK deal, baking in revenue of about US$48.8b and earnings of US$10.2b by 2029. You can now ask whether this Monzo reset nudges those upbeat forecasts lower or simply redirects them, and then compare several different viewpoints before deciding what makes sense for you.

    Explore 10 other Nu Holdings fair value estimates, including one that suggests as much as 318% upside from the current price.

    Reach Your Own Conclusion

    Don't just follow the ticker. Dig into the data and build a conviction that's truly your own.

    Looking For More Investment Ideas Beyond Nu Holdings?

    If this Nu Holdings update has sharpened your view on risk, return and balance sheet strength, it can be useful to line it up against other potential opportunities using the Simply Wall St Screener.

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.