Earnings season can be humbling, so I hope you allow me the opportunity to boast when given the chance. The last time I wrote about Nu Holdings (NYSE: NU) -- on June 3 -- the Latin American fintech was sliding. The parent company of Brazil's fast-growing NuBank was reeling from analyst downgrades and mounting headwinds.
I argued that it wasn't too soon to call a bottom on the stock, the same day it hit a 52-week low of $11.20. Following weeks of upticks and a jump after posting blowout results after Thursday's market close, Nu has jumped almost 40% from its June low. This Rare Signal Is Flashing Again.
In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue » I guess it's time for another bold prediction: Nu's bounce is just getting started.
Nu Holdings has come a long way in a short time. The digital banking platform that launched in Brazil just a dozen years ago, in the form of a no-fee credit card for mass-market users, now reaches more than 62% of the country's adult population. Thursday afternoon's financial update shows there is still significant growth potential for Nu and its shareholders.
The fintech speedster is now serving 138.9 million accounts, a 13% increase over the past year. That's decent, but here's where the story gets better: Revenue rose three times faster in the second quarter, climbing 39% to $5.9 billion. Many factors are driving this top-line surge, but it ultimately comes down to Nubank customers leaning more on the company for their financial needs.
The activity rate keeps inching higher with every passing quarter. Purchase volume continues to outpace account growth. Customer deposits have risen 18% over the past year.
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