Nu Holdings (NU +3.13%) was previously an investment for Warren Buffett-led Berkshire Hathaway. The conglomerate owned shares from the initial public offering in December 2021 to the first quarter of this year, when it completely exited its position.
But just because Berkshire is no longer a shareholder, it doesn't mean the business lacks favorable qualities. In the past 12 months, this fintech stock has fallen 3% (as of July 11). However, it's up 24% in 2025 despite extreme volatility. Shares now trade below $13. Should you add Nu to your portfolio?
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Superb growth
Nu Holdings is a digital banking pioneer that operates in Brazil, Mexico, and Colombia. It offers customers various financial services that can be accessed via their smartphones. With a tech-forward approach and no physical bank branches, it shouldn't be surprising that it has been growing at a brisk pace.
As of March 31, the business had 119 million customers -- essentially double from 60 million three years ago. The home market of Brazil is Nu's most important, where its 105 million customers represent 59% of that country's adult population.
Even with such a high penetration, Nu's management says the company currently has only captured 5% of the gross-profit total addressable market in Brazil. There's clearly more potential for its financial performance to rise to get on par with its customer count.
NYSE: NU
Key Data Points
Mexico and Colombia are both relatively new markets for the fintech company, and the growth playbook is likely the same. It's all about leaning heavily on technology to provide an exceptional user experience.
It will be important for Nu to expand its deposit base because it provides low-cost funding that fuels loan growth. And deposit accounts can be sticky, leading to long-lasting customer relationships.
Investors can be optimistic that the growth ahead will still be robust. Nu could continue cross-selling products to existing customers while adding new customers.
And in the future, it has other markets in Latin America, albeit smaller ones, that it can tap. The consensus view from Wall Street analysts is that revenue will increase 29% this year, before rising 24% in 2026. This is an encouraging outlook.
Nu Holdings' expanding profits
Many fast-growing enterprises are primarily focused on acquiring new customers and growing their revenue as quickly as possible; producing net income is usually an afterthought. You were previously able to describe Nu this way.
But in 2023, the business finally turned the corner financially, reporting positive net income based on generally accepted accounting principles. In 2024, net income was up 91% year over year. Plus, it showed a 74% gain in the first quarter of this year.
Not having to deal with the overhead of physical bank branches helps. Nu's unit economics, or the financial situation of each customer relationship, is outstanding. During the first quarter of 2025, its monthly average revenue per active customer was $11.20. And the data shows that the longer a customer stays with Nu, the more lucrative they are for the business.
On the other hand, it only costs $0.70 per month on average to serve a customer. It's no wonder that as Nu scales up, it can boost the bottom line.
Between 2024 and 2027, diluted earnings per share are set to grow at a compound annual rate of 36%, according to analyst estimates. That's a wonderful forecast that should help drive the stock price higher.
With a fintech platform that's clearly resonating with people, rapid revenue growth, and expanding profits, you would be forgiven for assuming that Nu stock trades at an expensive valuation multiple. But this isn't the case at all. As of July 11, investors can buy shares at a forward price-to-earnings ratio of just 22.6. And with Nu Holdings trading below $13, this opportunity looks ripe for the picking.
