XP (XP) is back in focus after a 6.1% share price decline following its latest earnings, as investors weigh slower net inflows, a lower retail take rate, a CFO transition and fresh capital return plans.

At a share price of $17.22, XP has seen its 1 month share price return fall 12.77% and its 3 month share price return fall 22.92%, even though the year to date share price return is up 6.43% and the 3 year total shareholder return is up 7.15%. This suggests momentum has recently faded as investors reassess growth and risk after earnings, the new dividend and buyback plan, and the upcoming CFO change.

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With XP trading at $17.22 and carrying both an estimated 34% intrinsic discount and a sizeable 42% gap to analyst targets, you have to ask whether this reset is an opportunity or if the market is already discounting future growth.

Most Popular Narrative: 31.7% Undervalued

XP's most followed narrative puts fair value at $25.20 compared with the last close at $17.22, a gap that turns on how 2026 revenue guidance plays out.

The ongoing expansion of Brazil's middle class and gradual increase in personal savings rates are described as drivers of XP's addressable market. This is cited as supporting long-term AUM and retail client growth, which is expected to bolster revenue and earnings power as the company penetrates deeper into emerging segments.

Want to see what is reflected in that fair value gap? The narrative refers to compounding revenue, firm margins and a future earnings multiple that is characterized as anything but casual.

Result: Fair Value of $25.20 (UNDERVALUED)

However, risks around fee compression from tougher competition, as well as potential regulatory or tax changes on key products, could quickly challenge that underpriced narrative.

Next Steps

Given the mix of optimism and concern running through this story, it makes sense to move quickly, examine the numbers yourself, and pressure test every assumption before sentiment shifts again. You can start by checking the 5 key rewards

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.