Should You Buy Nu Holdings While It's Below $13?

Key Points

• Nu benefits from being able to tap a huge unbanked and underbanked population, and it can lean on its tech prowess to attract customers.

• Revenue growth has been impressive, and the top-line gains have fueled rising profits thanks to strong unit economics.

• At a forward P/E below 23, Nu stock looks like a smart buy.

• 10 stocks we like better than Nu Holdings ›

Nu Holdings (NYSE: NU) was previously an investment for Warren Buffett-led Berkshire Hathaway. The conglomerate owned shares from the initial public offering in December 2021 to the first quarter of this year, when it completely exited its position.

But just because Berkshire is no longer a shareholder, it doesn't mean the business lacks favorable qualities. In the past 12 months, this fintech stock has fallen 3% (as of July 11). However, it's up 24% in 2025 despite extreme volatility. Shares now trade below $13. Should you add Nu to your portfolio?

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Image source: Getty Images.

Superb growth

Nu Holdings is a digital banking pioneer that operates in Brazil, Mexico, and Colombia. It offers customers various financial services that can be accessed via their smartphones. With a tech-forward approach and no physical bank branches, it shouldn't be surprising that it has been growing at a brisk pace.

As of March 31, the business had 119 million customers -- essentially double from 60 million three years ago. The home market of Brazil is Nu's most important, where its 105 million customers represent 59% of that country's adult population.

Even with such a high penetration, Nu's management says the company currently has only captured 5% of the gross-profit total addressable market in Brazil. There's clearly more potential for its financial performance to rise to get on par with its customer count.

Mexico and Colombia are both relatively new markets for the fintech company, and the growth playbook is likely the same. It's all about leaning heavily on technology to provide an exceptional user experience.

It will be important for Nu to expand its deposit base because it provides low-cost funding that fuels loan growth. And deposit accounts can be sticky, leading to long-lasting customer relationships.

Investors can be optimistic that the growth ahead will still be robust. Nu could continue cross-selling products to existing customers while adding new customers.

And in the future, it has other markets in Latin America, albeit smaller ones, that it can tap. The consensus view from Wall Street analysts is that revenue will increase 29% this year, before rising 24% in 2026. This is an encouraging outlook.

Nu Holdings' expanding profits

Many fast-growing enterprises are primarily focused on acquiring new customers and growing their revenue as quickly as possible; producing net income is usually an afterthought. You were previously able to describe Nu this way.

But in 2023, the business finally turned the corner financially, reporting positive net income based on generally accepted accounting principles. In 2024, net income was up 91% year over year. Plus, it showed a 74% gain in the first quarter of this year.

Not having to deal with the overhead of physical bank branches helps. Nu's unit economics, or the financial situation of each customer relationship, is outstanding. During the first quarter of 2025, its monthly average revenue per active customer was $11.20. And the data shows that the longer a customer stays with Nu, the more lucrative they are for the business.

On the other hand, it only costs $0.70 per month on average to serve a customer. It's no wonder that as Nu scales up, it can boost the bottom line.

Between 2024 and 2027, diluted earnings per share are set to grow at a compound annual rate of 36%, according to analyst estimates. That's a wonderful forecast that should help drive the stock price higher.

With a fintech platform that's clearly resonating with people, rapid revenue growth, and expanding profits, you would be forgiven for assuming that Nu stock trades at an expensive valuation multiple. But this isn't the case at all. As of July 11, investors can buy shares at a forward price-to-earnings ratio of just 22.6. And with Nu Holdings trading below $13, this opportunity looks ripe for the picking.

Should you invest $1,000 in Nu Holdings right now?

Before you buy stock in Nu Holdings, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nu Holdings wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $680,559!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,005,670!*

Now, it’s worth noting Stock Advisor’s total average return is 1,053% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 15, 2025

Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool recommends Nu Holdings. The Motley Fool has a disclosure policy.