Noah
Stock Investor & Trader, US Equities
Nu Holdings just entered the US with a cost to serve of $1 per customer, which no one can compete with. That makes it the most undervalued stock in the market. SoFi still carries higher long-term conviction, but Nu has seriously impressed over the last couple of quarters, and the two target different income levels. x.com x.com x.comÂ
Nu Holdings trades at only 12x forward earnings despite strong growth, expanding profitability and operating leverage across its businesses and products. It costs under $1 to serve a customer, with no branches, paperwork or hidden fees; it reached 130+ million customers in eleven years and runs a 20% efficiency ratio versus 55% for the average bank. Per @JonahLupton, Q2 revenue rose 50% and net income 67%; he puts it near 11.2x next-twelve-month EPS with fair value of $24-28 per share. x.com … Show more
Nu Holdings looks mispriced because its fundamentals keep strengthening while sentiment and macro concerns pressure the stock. It has more than 135 million customers after adding about 4 million in Q1, when revenue was $5.3B and net income $871M, with a 29% ROE, an 83% activity rate and an efficiency ratio improved to 17.6%. That disconnect is the reason to add, though it remains a higher-risk position. x.comÂ
Nu Holdings delivered another strong quarter and still has plenty of room to raise revenue per customer. Accounting revenue of $5.51B came in 2.6% ahead of Bloomberg consensus. @two_chump notes Nu now has 139 million customers, 50% more than JPMorgan. x.com x.com x.com x.comÂ
Nu Holdings' growth under Lula makes today's selloff look absurd. On a TTM basis since Q1 2023, revenue rose 270% and net income went from a $180 million loss to $3.61 billion, or $0.74 EPS; having done so well during his term, it should be fine going forward. x.com x.com x.comÂ
Nu Holdings is a buy today because it shows operating leverage. Since 2020, monthly revenue per active customer has risen 382%, from $3.30 to $15.90, while the cost to serve each customer fell from $1.10 to $1.00: more revenue at lower cost. x.com x.comÂ
Nu Holdings' management keeps delivering impressive growth and improving profitability, with net income up 67% year over year, supporting its long-term growth story even though the stock is down 10% year to date. x.comÂ
Grab is building an ecosystem around Southeast Asian consumers' everyday needs, so each customer grows more valuable as they use more services. Q2 monthly transacting users rose 17% to 53.9M, revenue rose 22% to $997M and adjusted EBITDA rose 54% to $168M, while the loan book nearly tripled to $2.3B. The share price has been flat for years despite this. If users, engagement and financial services keep growing, the next 5-10 years could be extraordinary; competition is the main risk. x.comÂ