Is Nu Holdings Overvalued or Primed for More Growth?

Brazilian fintech Nu Holdings Ltd. (NYSE: NU) has only been trading publicly for under three years, but it has already managed to accumulate over 100 million customers in Latin America. The company, which offers digital banking solutions without brick-and-mortar locations through its NuBank platform, has also drawn the interest of Warren Buffett, instantly catapulting it into must-watch lists of investors everywhere as a newly popular bank stock. Buffett's Berkshire Hathaway Inc. held over 107 million shares of NU stock as of the end of the second quarter.

Nu shares fell by about 8% in the last week but remain up a whopping 86% over the past year. Based on analyst ratings, the company is currently categorized as a Moderate Buy and has a consensus price target of $14.08, representing 7.2% upside potential. Given that this increase would only roughly get the stock to where it was in mid-September, and particularly in light of how far it has risen in the last several months, investors may be wondering whether the time to get in on Nu Holdings has passed.

Earnings Performance Excels

Nu has a strong history of earnings performance in the last six quarters, including net income of $487 million for the most recent quarter. This represented EPS of ...