Nu Holdings (NU), mcap=$21.5bn, price $4.67 vs $4.01

– Fast growing, US-listed LatAm digital bank with 60m accounts, mainly in Brazil.
– Strong cost advantage relative to incumbents.
– While NU’s penetration in terms of accounts is 33% of Brazil’s adult population, other products (credit cards, loans, etc.) remain underpenetrated providing strong growth potential.
– Revenue per active account is projected to increase from $80 to $150 by 2025 (in line with incumbent banks).
– Trades at 7.2x projected 2025 earnings.
– The bear case rests on deteriorating credit and asset quality in Brazil.

– Projected to generate $0.55 EPS by 2025 (vs negative net income so far).
– At 20x EPS multiple, that’s $20/share.

Exp. gain: +175% to $11/share

Full $NU write-up (free guest account required):

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