Maurice was discovered mid-spreadsheet, one paw furiously scribbling notes while the other adjusted his tiny reading glasses that kept slipping down his snout.
Listen, I’ve been watching fintech startups for fifteen years. I’ve seen them bloom like overripe bananas in the sun, all promise and appeal, then rot into irrelevance within months. Venture-backed dreams. Slick pitch decks. Zero profit. The usual story.
Then there’s Nu Holdings Ltd. (NU), and frankly, it’s making everyone else look like they’re still using stone tablets to process payments.
Here’s what stopped me mid-fruit-toss: This company is doing something genuinely radical. It’s profitable. Not “we might be profitable someday if we sacrifice a goat.” Profitable right now, with a 41% profit margin. In fintech. In emerging markets. While handling 43.9% year-over-year revenue growth. Do you understand how bonkers that is?
Let me back up. Nu started in Brazil in 2013 with a simple idea: what if banking didn’t require waiting in lines or talking to humans who didn’t understand your needs? They built Nubank—a completely digital bank for ordinary people—and it worked so well that they’ve now expanded into Mexico, Colombia, the United States, and beyond. They’re not a feature. They’re not a white-label payment processor hidden in someone else’s app. They’re an actual bank with millions of customers and real economics.
The numbers are the part that made me throw an actual banana at my monitor (it bounced off the revenue growth chart). Trading at a forward P/E of 12.95x with 43.9% revenue growth and 60.9% earnings growth? That’s not just cheap. That’s “how is this real” cheap. For context, if you bought $1,000 worth of NU at Foxy’s entry recommendation of $17.94, you’d own 55.7 shares. Today at $14.96, you’re down 16.61%. But here’s where it gets interesting: every analyst in sight is screaming “strong buy,” the target price sits around $20.04 to $24.50, and the company is literally minting money in geographies where traditional banks still think fax machines are cutting-edge technology.
Let me tell you why this matters.
The Banana Economics of Emerging Market Banking
Here’s the thing about Brazil, Mexico, and Colombia: hundreds of millions of people have smartphones but no access to decent banking. It’s not that they don’t want financial services. It’s that the system was built by banks for people who didn’t exist yet. Nu walked in, looked at that entire broken ecosystem, and said, “We’ll fix this with an app.”
A digital bank has roughly 60-70% lower infrastructure costs than a traditional bank. No branches. No tellers. No overhead. Just servers and the relentless focus on what customers actually need. And when you’re serving populations that traditional banks have basically ignored, the unit economics are absolutely bonkers.
Nu’s profit margin of 41% tells you something crucial: they’ve scaled past the “losing money to acquire customers” phase. They’re in the “we built something people actually want to use” phase. Their customer acquisition cost has presumably stabilized. They’re expanding products—crypto, insurance, lending, investment services—all within their existing customer base, which means they’re not constantly firefighting to replace churn.
The 43.9% revenue growth is coming from two places: more customers and those customers using more services. That’s the healthiest growth trajectory in fintech because you’re not chasing it. It’s organic. It’s sticky. It’s what happens when you solve a real problem at scale.
The Forward P/E Question
Now, I want to be honest about what’s happening here. The current P/E of 25.79x looks expensive. The forward P/E of 12.95x looks cheap. The gap between those numbers is your market telling you something: “We think earnings are about to expand dramatically.” And given that earnings growth is running at 60.9%, the market isn’t being irrational. If NU grows earnings at 40-50% annually for the next two years—which the fundamentals suggest they can—then 12.95x forward earnings becomes a bargain.
But here’s where I adjust my tiny tie and get serious: that assumes growth sustains. In banking, there’s always a competitor risk. What if one of the big established banks wakes up and actually competes digitally? What if regulatory changes in Brazil or Mexico make it harder to operate? The short interest ratio of 2.26% suggests bears aren’t super worried, but they exist.
The real risk isn’t the company. The real risk is that emerging market growth sometimes surprises downward. Brazil’s economy can be volatile. Regulatory environments shift. What looks like a clear runway can suddenly get complicated.
The US Expansion Wild Card
Here’s what’s making analysts genuinely excited: Nu recently hired an ex-Amazon executive to lead US expansion, and they’re building a US banking platform from scratch. The US market is 300+ million people with mediocre banking options. Nu already knows how to build digital banking. They’ve done it in three Latin American countries simultaneously. If they can bring that product philosophy to the US—which is a much bigger TAM (total addressable market)—then the current revenue is just the appetizer.
This is why Foxy’s confidence rating of 9/10 makes sense. The company has proven its model works. It’s profitable. It’s growing explosively. And it’s now entering the largest banking market in the world with a product that existing US banks can’t seem to figure out.
But again: execution matters. US banking has regulations that make Brazil look like the Wild West. It’s a different game.
The Real Question: Is Now the Time?
You’re sitting here looking at NU at $14.96, down from Foxy’s $17.94 entry. The target is $20-$24.50. That’s a 34-64% potential return. The forward P/E is reasonable. The growth is exceptional. The analyst consensus is strong buy.
But the market is pricing in some skepticism. That 16% pullback from the entry price isn’t random. Either the market is wrong (which happens!), or the market is pricing in some real execution risk.
I think the market is slightly wrong here, but not wildly wrong. Nu is a genuinely good company at a genuinely reasonable valuation. It’s not a screaming bargain that requires immediate action. It’s more like finding a really nice banana at exactly the right price of ripeness—not green, not brown, but perfect for eating right now.
The 3-5 year outlook? If they execute on US expansion and continue growing in Latin America at 30%+ annually while maintaining margins, this stock could legitimately reach $30-$40. If they hit some regulatory headwinds and growth slows to 15-20%, then you’re looking at $20-$25 being fair value. Most likely: somewhere in between.
For a 5-year holding period with a 2-3 year outlook for meaningful upside, NU at $14.96 is exactly the kind of stock that builds wealth quietly while everyone else is chasing the shiny mega-cap tech story.
The Monkey Momentum Index isn’t recommending you throw your entire portfolio at NU. It’s saying: if you believe in fintech, if you believe in emerging market growth, and if you can handle some volatility, this is a company that has already done the hard part (proving the model works) and is now in the “just execute” phase. That’s when you want to own things.
Maurice is putting this one on the “serious consideration” shelf. Not panic-buy urgent. Not “meh, skip it” either. Right in that Goldilocks zone where you’re making a calculated bet on a company that has genuinely earned the right to be profitable and is just getting started.
Trained Market Monkey 