Nu Holdings (NYSE:NU) is back in focus after first quarter 2026 results combined strong reported revenue and net income with misses versus earnings and sales forecasts, alongside fresh progress on AI and U.S. expansion.

At a share price of US$12.93, Nu’s recent momentum has cooled, with the 30 day share price return down 15.77% and the year to date share price return down 24.03%. Even so, the 3 year total shareholder return of 102.35% still reflects a very strong longer term gain.

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With the stock pulling back after an earnings miss but still carrying strong multi year gains and trading below the average analyst price target, the key question is whether Nu is now undervalued or if the market is already pricing in its AI and U.S. growth story.

Most Popular Narrative: 79.9% Undervalued

Against the last close of $12.93, the most followed narrative on Nu values the stock at $64.30, implying a very large gap between market price and perceived worth.

Nu Holdings was founded in 2013 with a deceptively simple premise. It was build a bank people actually like, charge nothing to get started, and let the product do the selling. The first product was a no-annual-fee credit card managed entirely via a phone app. There were no branches, no physical infrastructure, and no legacy IT systems to slow things down. Customers joined through referrals. The waiting list became a status symbol.

Want to understand why this narrative supports such a high fair value? It leans heavily on rapid revenue expansion, widening margins, and a future earnings profile more often associated with mature global platforms.

Result: Fair Value of $64.30 (UNDERVALUED)

However, you still need to keep an eye on regulatory demands around a full banking license in Brazil, as well as any slowdown in Nu’s expansion outside its home market.

Another View: Multiples Point To A Richer Price

While the popular narrative sees Nu as 79.9% undervalued, the current P/E of 21.9x tells a different story. That is well above the peer average of 13.8x, the US Banks industry at 11.2x, and even the fair ratio of 17.5x, which points to meaningful valuation risk if expectations slip.

For investors who put more weight on earnings multiples than narratives, this gap raises a simple question: is Nu priced for perfection or just for its growth profile?

Next Steps

With both bullish and cautious views on the table, this is the moment to move quickly, review the full picture, and weigh up Nu’s potential using 4 key rewards and 2 important warning signs

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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.