Can XP Inc Sustain Double-Digit Growth After March Volatility Disrupted Its Sequential Momentum?

Note: These figures reflect diluted GAAP earnings per share, reported before non-recurring items, and may differ from the non-GAAP figures used by some sources.

Part 2.1: Price Behavior Around Earnings

XP typically reports earnings after market close, meaning Day 0 reflects pre-announcement anticipation while Day +1 captures the market's first full reaction to results.

XP's post-earnings price behavior shows significant volatility, with an average absolute Day 0 move of 1.53% and Day +1 move of 3.61%. The Day +1 reaction has been particularly pronounced, with the stock experiencing moves ranging from -8.57% (August 2025) to +6.18% (August 2024), demonstrating that the market's full assessment often takes a session to materialize.

The most recent earnings cycle (May 2026) saw relatively muted movement, with a -0.74% Day 0 decline followed by a -3.86% Day +1 drop after the company missed estimates. This contrasts sharply with the August 2024 report, which generated a +2.27% Day 0 gain and a strong +6.18% Day +1 follow-through. The historical pattern suggests investors should prepare for potential mid-single-digit percentage swings in either direction, with the Day +1 session typically delivering the more decisive move. The 5.46% average Day +1 range indicates substantial intraday volatility as the market digests results and management commentary.

Part 2.2: Options Market Expected Move

The options market is pricing a 5.99% expected move for the upcoming earnings release, which sits above the 1.53% average Day 0 move but below the 3.61% average Day +1 move from recent history. This suggests options traders are anticipating a more significant reaction than the typical Day 0 anticipation move but are pricing in somewhat less volatility than the stock has historically delivered by the end of Day +1. Given XP's pattern of delayed reactions—where the Day +1 move often exceeds Day 0—the 5.99% implied move appears reasonably calibrated to historical behavior, though investors should note that actual moves have ranged as high as 8.57% in recent quarters.

Part 3: What Analysts Are Saying

Analyst sentiment on XP remains constructive, with a consensus rating of 4.20 out of 5.00 (between Buy and Strong Buy) and an average price target of $23.51. The analyst community shows strong conviction, with 6 Strong Buy ratings, 0 Moderate Buys, 4 Hold ratings, and no Sell or Strong Sell recommendations among the 10 analysts covering the stock.

The consensus price target of $23.51 implies 48.6% upside from the current price of $15.82, suggesting analysts see substantial value despite recent stock weakness. Price targets range from a low of $21.00 to a high of $26.00, indicating general agreement on the stock's upside potential even among more conservative analysts.

Sentiment has remained unchanged over the past month, with the analyst count and average recommendation holding steady at current levels. This stability suggests analysts are maintaining their conviction in XP's long-term story despite near-term stock price volatility and the recent Q1 earnings miss. The lack of downgrades following the Q1 shortfall indicates analysts view it as a temporary stumble rather than a fundamental deterioration in the business model. The wide gap between the current stock price and analyst targets reflects either significant perceived undervaluation or a market that remains skeptical of XP's ability to deliver on growth expectations—the upcoming earnings report will be critical in determining which interpretation proves correct.

Part 4: Technical Picture

XP enters the earnings release in a deteriorating technical position, with the Barchart Technical Opinion showing an 88% Sell signal—a significant weakening from 72% Sell one week ago and 40% Sell one month ago. This progressive deterioration reflects mounting technical pressure as the stock has failed to hold key support levels.

The stock is currently trading at $15.82, positioned below five of six major moving averages: the 10-day ($16.27), 20-day ($16.56), 50-day ($16.21), 100-day ($17.45), and 200-day ($18.09). The only moving average providing support is the 5-day at $15.76, which the stock is barely holding above. This configuration indicates a clear downtrend across multiple timeframes, with the stock trading 12.5% below its 200-day moving average—a significant technical breakdown.

Timeframe Analysis:

• Short-term (50% Sell): Moderate sell signal indicates near-term momentum has turned negative, though not at extreme levels
• Medium-term (100% Sell): Strong sell signal across all intermediate-term indicators reflects sustained weakness in the trend
• Long-term (100% Sell): Maximum bearish reading suggests the longer-term trend has decisively turned negative

Trend Characteristics: The combination of Strong strength and Average direction indicates the current downtrend is well-established and persistent, though not accelerating dramatically—a concerning setup heading into a high-stakes earnings event.

The technical setup is decidedly cautionary heading into earnings. With the stock trading below all major moving averages except the 5-day and showing deteriorating momentum across all timeframes, XP faces significant technical resistance overhead. The nearest resistance levels sit at the 10-day moving average ($16.27) and 50-day moving average ($16.21), both requiring roughly 2.8% gains to reclaim. More importantly, the 200-day moving average at $18.09 represents a critical long-term resistance level now 14.3% above current prices. For the stock to reverse its technical deterioration, XP will likely need to deliver not just a solid earnings beat but also provide guidance that convinces investors the Q1 miss was an anomaly. The 88% Sell signal and positioning below key moving averages suggest the market is positioned defensively, meaning a positive surprise could trigger short-covering and technical buying, while any disappointment risks accelerating the existing downtrend.