Nubank Shares Soar After Earnings Beat and Positive Outlook

Nubank shares hit a month-high after Citigroup upgraded the fintech to buy from sell, following a quarterly earnings beat and positive outlook on asset quality. This is the third buy upgrade in a week, with Citi analysts citing new credit initiatives paying off. Nubank now has 15 buy recommendations, with an average target price implying a 17.1% potential return over the last close.

Nubank shares hit a month-high after Citigroup upgraded the fintech to a "buy" rating from "sell," following a quarterly earnings beat and a positive outlook on asset quality. This is the third buy upgrade in a week, with Citi analysts citing new credit initiatives paying off. Nubank now has 15 buy recommendations, with an average target price implying a 17.1% potential return over the last close.

Citigroup analysts raised their price target for Nubank (NU) to $18, up from $9, representing a 37.2% upside to the stock's last close. The upgrade reflects Citigroup's optimism about Nubank's earnings momentum, driven by positive trends in Brazil and TPV dynamics, as well as tailwinds from Mexico and Colombia, and efficiency gains aiding return-on-equity [1].

Nubank's stock has recently experienced a surge, rising 1.55% on August 7, 2025, with a trading volume of $0.43 billion, ranking 272nd in market activity. The stock's forward P/E of 22.35 exceeds the finance sector's average of 10.13, while its PEG ratio of 0.69 suggests earnings growth outpaces valuation [3].

Despite the elevated forward P/E, Nubank's high-volume strategy has yielded strong returns, with a backtest showing a 166.71% return from 2022 to the present, outperforming the benchmark by 137.53% [3]. As Nubank prepares to release its Q2 earnings, investors will closely monitor the company's ability to deliver on expectations, with a strong print likely to reaffirm its long-term growth story and potentially boost the stock's valuation.

References:
[1] https://www.ainvest.com/news/citi-upgrades-nu-holdings-buy-sees-potential-earnings-acceleration-2508/
[2] https://www.ainvest.com/news/nu-holdings-q2-revenue-surpasses-expectations-strong-customer-growth-purchase-volume-2508/
[3] https://www.ainvest.com/news/nu-holdings-pioneering-embedded-finance-revolution-latin-america-untapped-markets-2508/