Nu Holdings shows strong growth and profitability but remains undervalued due to market risk concerns.

Nu Holdings, a leading Latin American fintech, continues to deliver strong growth and profitability with a sub-20% efficiency ratio, $895 million net income, and 131 million customer accounts. Its average revenue per active customer (ARPAC) rose 25% year-over-year to $15 in Q4 2025. The company is expanding strategically into the U.S. market, targeting Latino customers and higher ARPAC, which could drive significant long-term growth. Despite this, Nu trades at a relatively low price-to-earnings ratio of 13x for 2027, reflecting market perceptions of risk and treating it like a slower-growth legacy bank, suggesting potential undervaluation and upside for investors.