Healthy Upside Potential: Nu Holdings Ltd. (NU)

Nu Holdings Ltd. (NYSE: NU) stock jumped 2.81% on Tuesday to $4.03 against a previous-day closing price of $3.92. With 21.06 million shares changed hands, the volume of the stock remained lighter than its average volume of 28.05 million shares. During the session, the Banks – Diversified company that operates in wider Financial sector, reached to the highest price of $4.0400 whereas the lowest price it dropped to was $3.8700. The 52-week range on NU shows that it touched its highest point at $11.83 and its lowest point at $3.26 during that stretch. It currently has a 1-year price target of $6.66.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of NU was up-trending over the past week, with a rise of 9.81%, but this was up by 3.07% over a month. Three-month performance dropped to -11.04% while six-month performance fell -3.12%. The stock lost -46.55% in the past year, while it has lost -0.98% so far this year. A look at the trailing 12-month EPS for NU yields -0.03 with Next year EPS estimates of 0.08. For the next quarter, that number is 0.00. This implies an EPS growth rate of 3.80% for this year and 338.89% for next year.

Float and Shares Shorts:

At present, 4.68 billion NU shares are outstanding with a float of 3.13 billion shares on hand for trading. On Oct 13, 2022, short shares totaled 89.37 million, which was 1.91% higher than short shares on Sep 14, 2022. In addition to Mr. David Velez-Osomo as the firm’s Founder, Chairman & CEO, Mr. Youssef Lahrech serves as its COO & Pres.

Institutional Ownership:

Through their ownership of 68.40% of NU’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 17.30% of NU, in contrast to 14.16% held by mutual funds. Shares owned by individuals account for –. As the largest shareholder in NU with 3.07% of the stake, Berkshire Hathaway, Inc. holds 107,118,784 shares worth 107,118,784. A second-largest stockholder of NU, Jennison Associates LLC, holds 94,293,389 shares, controlling over 2.70% of the firm’s shares. Baillie Gifford & Co. is the third largest shareholder in NU, holding 87,235,018 shares or 2.50% stake. With a 1.19% stake in NU, the Vanguard International Growth Fun is the largest stakeholder. A total of 41,521,004 shares are owned by the mutual fund manager. The American Funds New World Fund, which owns about 1.02% of NU stock, is the second-largest Mutual Fund holder. It holds 35,714,079 shares valued at 145.36 million. American Funds EuroPacific Growth holds 0.86% of the stake in NU, owning 29,887,901 shares worth 121.64 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for NU since 21 analysts follow the stock currently. There are 12 analysts who recommend BUY ratings, while 3 suggest SELL ratings. Of the remaining analysts, 6 believe that the stock is worth HOLDING, 0 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With NU analysts setting a high price target of $12.40 and a low target of $3.00, the average target price over the next 12 months is $6.54. Based on these targets, NU could surge 207.69% to reach the target high and fall by -25.56% to reach the target low. Reaching the average price target will result in a growth of 62.28% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. NU will report FY 2022 earnings on 02/21/2024. Analysts have provided yearly estimates in a range of $0.04 being high and -$0.06 being low. For NU, this leads to a yearly average estimate of $0.01. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Nu Holdings Ltd. surprised analysts by $0.01 when it reported $0.01 EPS against a consensus estimate of $0.00. The surprise factor in the prior quarter was $0.00. The average estimate for the next quarter is thus $0.01.

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