Buy NU as It Broke Out to All-time Highs

Key points:

 

  • Buy Nu Holdings stock as it broke out to an all-time high from a stage-three flat base and is actionable in the pivot range of $12.5–13.1. Nu Bank is scaling in Mexico at a faster pace than Brazil, with reacceleration in customer additions. The total revenue growth rate has been accelerating and has been 60%+ for the past four quarters, while net profit has been growing in triple digits for the past two quarters. The bank is foraying into banking through AI by partnering with two companies in June to accelerate its AI-first strategy.
  • Good fundamental profile: Good EPS Rank 80 and SMR Rating of A. It turned profitable in FY23. The Street expects strong EPS growth of 63% y/y and 54% y/y in FY24 and FY25, respectively.
  • Excellent technical profile: RS line is trending upward and is near an all-time high. RS Rating has remained stable above 90 for the past nine weeks. Up/Down Volume ratio of 1.1 and a positive Acc/Dist Rating denote good demand for the stock.