NEW YORK, August 12, 2026, 13:56 EDT
- Nu shares were last down roughly 1.1% at $13.51 in early trade.
- Second-quarter earnings are set for release after the market closes on August 13.
- Investor focus is primarily on credit quality and risk-adjusted margin.
Nu Holdings Ltd. NYSE:NU shares declined on Wednesday, a day ahead of its second-quarter results. The decline brings the stock to about 10% under its 200-day moving average. The primary concern is not growth, but credit economics.
Investors are expected to overlook another probable increase in customers and lending. The bigger challenge is if risk-adjusted margin steadied following a 100 basis point drop in the first quarter. Nu accelerated credit growth even as loss allowances rose. That balance could determine the stock’s future movement.
| Market measure | August 12 reading | Investor context |
|---|---|---|
| Share price | $13.51 | Falls roughly 1.1% during the day |
| 50-day average | $13.34 | Shares trading a little higher |
| 200-day average | $15.08 | Stock sitting around 10% under |
| 52-week range | $11.20-$18.98 | Currently in the bottom half of its range |
| Market value | About $65.2 billion | Comparable to other large-cap fintech firms |
The company is scheduled to release its results on Thursday following the close of U.S. trading. The stock’s trailing price-to-earnings ratio was close to 21, while its forward multiple stood at approximately 16, according to S&P Global data. This difference reflects expectations for continued earnings growth.
Nu started the quarter with significant momentum. For the first time, first-quarter revenue surpassed $5 billion. Net income increased 41% to $871 million, and return on equity climbed to 29%. The loan portfolio expanded by 40% year-on-year to $37.2 billion.
| Operating measure | Q1 2026 baseline | What Q2 must show |
|---|---|---|
| Revenue | Above $5.0 billion | Monetisation continues to surpass expansion in scale |
| Net income | $871 million, a 41% year-on-year increase | Growth holds up despite increased credit costs |
| ROE | 29% | Returns stay close to the high-20 percent range |
| Risk-adjusted NIM | 9.5%, a drop of 100 bps from the prior quarter | Quarterly trend steadies |
| 15-90 day NPL ratio | 5.0%, an 89 bps rise over the quarter | Seasonal impact starts to lessen |
| Deposits | $42.4 billion, up 22% from the prior year | Funding matches the pace of lending |
Credit-loss allowances climbed 33% from the previous quarter to $1.79 billion, highlighting the pressure point. Early-stage delinquencies rose as well, though Nu described the increase as seasonal. Meanwhile, loans expanded at a quicker pace than deposits, pushing the loan-to-deposit ratio up to 58.3% from 49.1% in the prior quarter.
According to management, its underwriting technology enables further growth. Founder and CEO David Velez said, “We are not adding AI to banking, we are rebuilding banking around AI.” He also stated that the models allow Nu to “grow limits with resilience, not just speed.” Nu management comments
Thursday’s results will challenge that assertion. If the risk-adjusted margin remains steady and early delinquencies ease, the argument for growth is strengthened. But if margins fall sharply again, expanding the loan book could appear costlier.
| Analyst | Latest stance | Target | Action date |
|---|---|---|---|
| JPMorgan | Buy | $20 | July 7, 2026 |
| Needham | Buy | $17 | June 26, 2026 |
| Citi | Hold | $13 | June 15, 2026 |
| Susquehanna | Hold | $13 | June 3, 2026 |
| BofA Securities | Sell | $10 | June 2, 2026 |
Most analysts maintain a positive outlook. Out of the group, 22 analysts rate the stock as Buy, with the consensus price target sitting at $17.98 on average—roughly 33% higher than the price on Wednesday. However, estimates vary widely, ranging from $10 to $22, highlighting uncertainty around margins, investment, and growth strategies.
Nu possesses a capital buffer. The company’s board has approved share buybacks of up to $1 billion within a 12-month window, beginning June 4. There is no mandatory minimum purchase under the plan. Investors need to see real execution figures before considering this as definitive demand.
Peer comparison provides perspective. Nu’s forward multiple is lower than U.S. fintech SoFi Technologies Inc. NASDAQ:SOFI, yet higher than Brazilian bank Itaú Unibanco Holding S.A. NYSE:ITUB. The higher valuation reflects stronger growth prospects and ongoing returns.
| Company | Forward P/E | Price/book | 52-week share change |
|---|---|---|---|
| Nu Holdings | 11.7x | 5.2x | Up around 10% |
| Itaú Unibanco | 7.4x | 1.9x | Up about 10% |
| SoFi Technologies | 22.0x | 2.1x | Down nearly 24% |
Risks: Fluctuations in currencies may affect reported growth figures. An increase in unsecured lending could lead to higher losses. Efficiency may come under strain from U.S. growth initiatives and expenses linked to office returns. Shifts in Brazil’s interest rates might impact funding and demand for credit.
The immediate challenge is straightforward. Nu isn’t required to demonstrate growth right now. What matters is proving that every new dollar of credit continues to generate sufficient returns after accounting for losses.
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