Rothschild Redburn reiterates Buy rating on Nu Holdings stock at $18

Rothschild Redburn reiterated its Buy rating on Nu Holdings (NU) with an $18 price target, citing the digital bank's application for a U.S. banking license as a pivotal step toward significant global expansion. This strategic move follows robust Q2 2025 earnings, which reported revenues of $3.7 billion and a net income of $637 million, reinforcing Nu's strong financial health and potential to evolve into a leading global digital bank. Other analysts have also adjusted price targets upwards, reflecting positive sentiment around Nu's strategic positioning and growth trajectory.

Analysis

Nu Holdings (NU) is undergoing a significant strategic pivot toward global expansion, underscored by its application for a U.S. banking license with the Office of the Comptroller of the Currency. This move is viewed by analysts, such as Rothschild Redburn, not as a standalone event but as a prelude to becoming a global digital bank. The ambition is supported by a robust financial foundation, evidenced by strong Q2 2025 results where revenue reached $3.7 billion, significantly surpassing the $3.16 billion forecast, and net income stood at $637 million. This financial outperformance, coupled with 21% year-over-year revenue growth, has prompted positive analyst revisions. Rothschild Redburn reiterated its Buy rating with an $18 price target, while Wolfe Research raised its target to $17, and BofA Securities increased its target to $16, albeit with a Neutral rating. With the stock trading near its 52-week high, the market is pricing in high expectations for the successful execution of the global strategy outlined by CEO David Vélez, making the next few months critical as investors await clearer guidance from management on this expansion.

Key Decisions for Investors

• Investors should consider the U.S. banking license application a major catalyst that could unlock a new phase of growth, justifying the positive analyst sentiment and the stock's performance near its 52-week high.
• It is critical to monitor upcoming management communications for concrete details regarding the timeline, cost, and strategy for global expansion, as execution risk is now a primary factor for the stock's future performance.
• Given the stock is trading near its peak and BofA Securities maintains a 'Neutral' rating, investors should weigh the priced-in optimism against potential execution hurdles before initiating or adding to a position.