I went to a soccer game over the weekend. Trust me, there’s an investing angle here — I’m not offsides. I caught the hometown Inter Miami CF team taking on the visiting New York Red Bulls. It was the second game at the brand-new, freshly christened Nu Stadium.
I’m guessing that most of my fellow 26,000 soccer fans in the stadium on Saturday night aren’t entirely sure what Nu is or does. Unless they’re investors — or Brazilian — that’s understandable. Beyond the shiny Nu Stadium sign on the outside of the stadium or the steady stream of LED branding ribbons inside, there is not a lot that someone in Miami can do with parent company Nu Holdings (NYSE: NU). But all of this could change sooner rather than later.
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Latin American fintech stocks aren’t like the sleepy stateside pioneers meandering through single-digit revenue growth these days. The region’s three largest fintech stocks posted top-line growth between 45% and 65% in their latest quarters.
Nubank parent Nu Holdings is the one in the middle, growing its fourth-quarter revenue 57% for the final three months of last year. It’s a force worth acknowledging for investors. Even with the iconic Lionel Messi playing for Inter Miami CF, the first two games at Nu Stadium ended in draws. Nu is playing to win. It wasn’t afraid to get Messi, and it’s not afraid to get messy either.
It’s been just 12 years since Nubank launched its first product — a fee-free credit card — in Brazil. Today, 62% of that country’s adult population has a Nubank account. Most of Nu’s 131 million accounts are in its home country. It also has a smaller but rapidly growing presence in Mexico and Colombia.
There has been speculation on which Latin American stronghold would be its next expansion market, but it might not be in that region at all. Nu Holdings received conditional approval for its U.S. national bank charter in January. Two months later, it stunned the market by securing naming rights for a high-profile stadium that just opened in Miami.
Like many Major League Soccer teams, there is no shortage of Latin American players playing for Inter Miami CF, and there is no shortage of Latin American fans. However, with Nu now on the pricey clock for naming rights, it’s just a matter of time before the U.S. becomes the fourth country for the fast-growing fintech.
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Nu Holdings stock has more than tripled over the last three years. Jaw-dropping growth has a funny way of being rewarded on Wall Street. Revenue more than doubled for three years through 2023. The top-line jumps have slowed, but this is where healthy margins are coming into play as the platform gets stickier.
Nu’s customer growth decelerated to 15% last year, but revenue still rose 57% in the fourth quarter on the strength of surging revenue per account. Average revenue per user clocked in at a record $15 a month, up from $11.10 a year earlier. There is power in that scalability. It only costs Nu roughly $0.80 per account per month to service.
Net income soared 62% in the fourth quarter. The $895 million in net income it generated in those final three months of 2025 works out to a net margin of 18.4%. Despite expanding beyond its flagship credit card to offer a broader portfolio of financial products over the years, the branchless bank’s efficiency ratio has continued to improve.
Paying up for stadium-naming rights in a country it hasn’t currently launched in yet would be a risky wager for most companies. It’s a rounding error for Nu and its massive margins. It’s hard to shake your head at such lavishness when Nu is cranking out a return on equity of 33%.
Despite the stock’s stellar run over the past couple of years — and its strong growth — Nu Holdings is probably cheaper than you think. You can buy Nu today for 18 times this year’s earnings and less than 14 times next year’s analyst profit target.
Put another way, three years ago, you could’ve bought Nu stock for four times what it is expected to earn next year. Long-term investors tend to win those games.
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Rick Munarriz has positions in Nu Holdings. The Motley Fool has positions in and recommends Nu Holdings. The Motley Fool has a disclosure policy.
Is It Time for Something Nu in Your Portfolio? was originally published by The Motley Fool
