Is Nu Holdings (NU) Worth Adding to Your Portfolio? Here's What You Need to Know

The Rally That’s Catching Investors’ Attention

Nu Holdings has made waves in the investment community, with its stock climbing over 50% during the past 12 months. This surge reflects genuine business momentum—the company has been steadily expanding its customer base, boosting revenue, and strengthening profitability across Latin America’s competitive fintech landscape. With the company set to report its February earnings, now might be the right time to assess whether this digital banking pioneer deserves a spot in your investment mix.

Understanding Nu’s Business Engine

At its core, Nu operates NuBank, which dominates Latin America as the continent’s largest fully digital banking platform. The company’s strategy is straightforward: eliminate the friction and costs of traditional banking by going entirely online and removing credit card fees. This approach has resonated strongly in Brazil, Mexico, and Colombia—markets where traditional banks have been slow to adapt.

The expansion beyond basic banking has been strategic. Nu now offers lending products, e-commerce payment solutions, and cryptocurrency trading capabilities, positioning itself as a comprehensive financial platform rather than a single-service provider.

The Numbers Tell a Compelling Story

The growth metrics speak for themselves. Between the end of 2021 and mid-2025, Nu’s active customer base has essentially doubled, climbing from 53.9 million to 127.0 million users. More importantly, the company has achieved this scale while improving customer engagement—the proportion of active users relative to total customers has risen from 76% to 83%.

Revenue generation per customer has accelerated impressively, nearly tripling from $4.50 to $13.40 annually, yet the cost to serve each active customer remained essentially flat at $0.90. This signals that Nu isn’t chasing growth recklessly; it’s building a more profitable operation as it expands.

Looking at the broader trajectory, Nu’s revenue expanded at an 89% compound annual growth rate from 2021 through 2024. The company achieved profitability in 2023 and has since more than doubled its earnings per share—all while navigating challenging economic conditions in key markets.

Recent Momentum and Market Reality

Over the past year, several trends have emerged. Customer growth has slowed somewhat, declining from 23% year-over-year in late 2024 to 16% by mid-2025. Activity rates have also dipped slightly throughout most of the year before stabilizing.

However, these decelerations aren’t warning signs—they’re natural consequences of pursuing growth in new markets. Expanding aggressively into Mexico and Colombia requires accepting thinner margins initially, as these markets demand higher funding costs and greater credit provisions than Brazil’s mature market. Nu’s decision to build capital-intensive secured lending and payroll-backed loan products has also pressured margins temporarily.

The result: revenue growth has stabilized and recovered to 42% year-over-year expansion (on a currency-neutral basis) by mid-2025, while net income growth has moderated from its earlier pace. This tradeoff—near-term margin compression for long-term market positioning—is exactly what you’d expect from a company prioritizing sustainable expansion over short-term earnings optimization.

What’s Fueling Growth Forward

Analysts expect Nu to deliver 36% revenue growth and 46% earnings-per-share growth for the full year. Beyond that, expectations call for revenue to expand at a 30% compound rate through 2027, with earnings growing even faster at 37% annually.

Several upcoming catalysts should accelerate this trajectory. Nu’s newly acquired banking license in Mexico will enable regulatory compliance and unlock new service offerings in a critical market. A pending application for a full banking license in Brazil and a U.S. bank charter could open additional expansion opportunities. These regulatory advances transform Nu from a fintech operating in gray areas into a legitimized banking player, which enhances credibility and competitive positioning.

Amazon’s recent integration of NuBank’s NuPay payment platform on its Brazilian website represents another tailwind, strengthening Nu’s position against competitors in the broader digital payments ecosystem.

The Valuation Question Before February’s Earnings

At $17 per share, Nu trades at approximately 20 times next year’s expected earnings. For a company targeting 30-37% growth through 2027, this valuation appears reasonable rather than expensive. The near-term economic headwinds affecting Latin America have likely created valuation pressure, but they’re temporary.

If you believe Nu can meet or exceed analyst expectations as it converts new customers and deepens engagement with existing ones, the stock presents an attractive entry point ahead of the February earnings announcement. The company has demonstrated both its ability to scale and its discipline in protecting profitability—two qualities that shouldn’t be taken for granted in the fintech space.

The key question isn’t whether Nu will continue growing—the evidence suggests it will. Rather, it’s whether you’re willing to accept near-term margin pressure as the price for positioning yourself alongside a company that’s reshaping financial services across an entire continent.