XP (NasdaqGS:XP) has opened Q1 2026 with total revenue of R$4.6b and basic EPS of R$2.53, setting the tone for how its profitability story is shaping up this year. Over the past six quarters, revenue has moved from R$4.2b in Q4 2024 to R$4.6b in Q1 2026, while basic EPS has gone from R$2.19 to R$2.53. This performance is supported by trailing twelve month EPS of R$10.02 on revenue of R$18.2b, which keeps the focus squarely on how durable XP’s margins look as this new quarter lands.

See our full analysis for XP.

With the latest earnings on the table, the next step is to set these figures against the key XP narratives investors have been following to see which stories hold up and which ones the numbers start to question.

Margins Steady With 28.8% Net Profit

• On a trailing basis, XP earned R$5.2b of net income on R$18.2b of revenue, which works out to a 28.8% net margin compared with 28.5% a year earlier.
• Consensus narrative points to technology spend and new products lifting efficiency over time, and the current 28.8% margin alongside basic EPS of R$10.02 over the last twelve months shows profitability that is already high, even as analysts also expect margins to ease slightly in future.

Bulls argue that XP can keep turning scale into earnings power, and this margin picture is a key part of that story, so it is worth seeing how the full bullish case lines up with these numbers 🐂 XP Bull Case.

EPS Growth Near 5-Year Pace

• Basic EPS over the last twelve months sits at R$10.02, against a five year earnings growth rate of 11.7% per year and trailing earnings growth of about 11.1% over the past year.
• Supporters of the bullish narrative see advisor productivity and cross selling driving long term earnings growth, and the fact that recent earnings growth remains close to the 11.7% multi year pace gives them data to point to, even though forecast EPS growth of about 11.8% a year is below the 16.8% forecast for the broader US market.

Low P/E Of 8.3x Versus Peers

• XP trades on a trailing P/E of 8.3x compared with a peer average of 15.5x and an industry average of 40.1x, while a DCF fair value of US$27.21 and an analyst target of US$24.66 both sit above the current share price of US$16.67.
• Bears highlight competition and fee compression as threats to future growth, and the current 8.3x P/E plus forecasts that earnings will grow around 11.8% a year give them room to argue that the market is already discounting slower growth than in the wider US market, even if the DCF fair value and analyst target suggest more optimistic investors see upside from here.

Skeptics question whether XP deserves a higher multiple given these growth forecasts, so it can help to look at how the more cautious narrative frames those risks in detail 🐻 XP Bear Case.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for XP on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

If the mix of optimism and caution in this earnings story leaves you undecided, take a closer look at the details and pressure test the bullish points for yourself, starting with the 5 key rewards.

See What Else Is Out There

XP pairs a low 8.3x P/E with earnings growth forecasts below the broader US market, which raises questions about how much upside is already priced in.

If that mix of modest growth expectations and valuation debate feels limiting, compare it with stocks screened for stronger perceived mispricing using the 54 high quality undervalued stocks.

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.