Reasons for the Outperformance of Nu Holdings Ltd. (NU)

White Falcon Capital Management, an investment fund manager, released its second quarter 2023 investor letter. A copy of the same can be downloaded here. In the second quarter, the fund was up 6.9% compared to the S&P 500 (CAD), the MSCI All Country (CAD), and the S&P TSX’s returns of 6.5%, 3.9%, and 1.2%, respectively. In the second quarter, the portfolio benefited from the rise in technology stocks. In addition, please check the fund’s top five holdings to know its best picks in 2023.

White Falcon Capital Management highlighted stocks like Nu Holdings Ltd. (NYSE:NU) in the second quarter 2023 investor letter. Headquartered in Sao Paulo, Brazil, Nu Holdings Ltd. (NYSE:NU) provides digital banking services. On July 14, 2023, Nu Holdings Ltd. (NYSE:NU) stock closed at $7.72 per share. One-month return of Nu Holdings Ltd. (NYSE:NU) was 2.39%, and its shares gained 98.46% of their value over the last 52 weeks. Nu Holdings Ltd. (NYSE:NU) has a market capitalization of $36.244 billion.

White Falcon Capital Management made the following comment about Nu Holdings Ltd. (NYSE:NU) in its second quarter 2023 investor letter:

“Nu Holdings Ltd. (NYSE:NU): Nu is a neo-bank based in Brazil. Nu is running the Capital One playbook where the business model is to lend to a credit starved population and leverage data and analytics to offer a superior product. Then, with this data, cross sell higher margin products to a subset of the customers. Nu has data and cost to serve advantages (no branches) and is gaining market share as it can lend at lower yields, have relatively lower NPLs and still make a high ROE. We believe Nu is a world class institution in every sense of the word. We initiated this position at 10x 2025E earnings estimate of $0.38 per share. Since then, management has executed well and brought forward profitability due to which current consensus estimate for 2025E earnings is $0.48 per share for a forward P/E of 15x.”

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Nu Holdings Ltd. (NYSE:NU) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 38 hedge fund portfolios held Nu Holdings Ltd. (NYSE:NU) at the end of the first quarter which was 31 in the previous quarter. In addition, please check out our hedge fund investor letters Q2 2023 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.