The first month of 2026 is coming to a close. And investors are already well on their way to figuring out what portfolio moves to make. Maybe companies that have performed well in the past are best positioned to keep the momentum going.
Here's why it's important to take a look at Nu Holdings (NU 5.52%). This fintech stock posted a monster 62% return last year. And Nu is poised to have another great showing in 2026.
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This booming fintech stock isn't expensive
After such a stellar performance, the wisest investors always wonder how a stock's valuation has changed. The last thing you want to do is overpay for a business, as market sentiment can shift to the downside without warning. It's important to make sure the starting valuation is reasonable.
As of Jan. 29, Nu shares trade at a forward price-to-earnings ratio of 23.4. That's a good deal, especially when you think about the next two factors.
Rapid growth is hard to overlook
It's rare to see outsize growth figures in the financial services industry, a market that investors are right to label as slow-moving and lacking innovation. Nu's growth resembles an early-stage start-up more than a mature bank.
The company collected $4.2 billion in revenue in the third quarter of 2025, increasing 42% year over year. After forecasting a 37% gain in 2025, analysts think the top line will rise 31% in 2026.
Nu dominates in its home market of Brazil, where it has 110 million customers. This number represents more than 60% of the adult population, which is a clear indication of the platform's broad reach. It also has 13 million customers in Mexico and 4 million in Colombia.
Expansion is likely to be strong for years to come. Compared to other parts of the world, Latin America has a large percentage of citizens that are still in need of basic banking products and services.
NYSE: NU
Key Data Points
Robust unit economics drive Nu's profitability
In addition to the valuation and growth prospects, 2026 will be Nu's year because of its soaring profits. Nu's business model does not depend on running costly bank branches, a strategy that reduces operational overhead. The business reported a net profit margin of 18.8% in the third quarter, expanding from 0.6% in Q3 2022.
The company says delinquency ratios are within expectations. And it's able to generate substantially greater revenue per customer than it costs to serve them. Founder and CEO David Vélez touts Nu's "low-cost and highly efficient platform."
Between now and the end of this year, Nu is ready for another strong performance.
