Nu Holdings shows strong growth despite stock decline

Nu Holdings, a fintech company operating in Brazil, Mexico, and Colombia, has a market value over $50 billion. Despite its volatility since going public in December 2021, Nu's shares have risen 180% in two years, although they have recently dropped by 26%. The stock is currently trading below $12. Nu offers various financial services such as checking accounts, credit cards, personal loans, and investments. The company operates fully online, allowing it to focus on technology and user experience. It has experienced rapid growth, ending last year with 114 million customers, a 470% increase from five years ago. The company's revenue has grown dramatically, nearly 19-fold from 2019 to 2024. Analysts project a 129% revenue growth over the next three years, especially in Brazil where over half of the adult population uses Nu’s services. Nu is also exploring entry into new markets. Unlike many fast-growing businesses, Nu reported a 17.1% net profit margin in 2024, improving from 12.8% the previous year. Analysts expect earnings per share to rise significantly in the coming years. Nu's efficient customer service model contributes to its profitability, making the stock attractive at a forward price-to-earnings ratio comparable to the S&P 500.