Nubank Stock Rises as Analysts Turn Positive After Strong Quarter

A string of upgrades from major banks has pushed Nubank back into favor with investors. Citi, Itaú BBA, and BTG Pactual all raised their ratings to Buy in August, reversing earlier caution.

Their calls followed second-quarter results that showed sharp profit and revenue growth, easing concerns over credit risks and profitability. The upgrades helped Nubank’s New York–listed shares climb about 15 percent from their recent lows.

Citi led the turn by moving from Sell to Buy and lifting its price target from 9 dollars to 18 dollars. Itaú BBA followed, restoring its Outperform rating after nine months of warning about risks in card operations.

BTG Pactual, which had never rated Nubank above Neutral since its 2021 IPO, finally upgraded to Buy, pointing to stronger card volumes in Brazil, rising momentum in Mexico, and the potential of payroll-deducted loans.

The analysts acted on results that exceeded expectations. Nubank reported 637 million dollars in net income, up 42 percent from a year earlier.

Revenue rose 40 percent on a currency-neutral basis to 3.7 billion dollars, while annualized return on equity reached 28 percent. The customer base grew to 122.7 million, including 12 million in Mexico and 3.4 million in Colombia.

The loan book increased to 27.3 billion dollars, with early delinquency improving to 4.4 percent and 90-day delinquency rising slightly to 6.6 percent.

Local investors also reacted, as Nubank’s Brazilian depositary receipt, ROXO34, mirrored the gains. The instrument has replaced the older NUBR33 since 2023 and tracks the New York–listed stock.

The deeper story is that Nubank has convinced skeptics that a digital bank in Latin America can scale profitably. Earlier fears about credit quality and margins have eased thanks to lower costs and resilient operations.

A stronger credit cycle in Brazil has also contributed to improved conditions. Expansion in Mexico and Colombia has started to diversify revenue, adding a second engine of growth.

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