We've been asking ourselves recently if the market has placed a fair valuation on Nu. Let's dive into some of the fundamental values of this large-cap Finance company to determine if there might be an opportunity here for value-minded investors.
Nu Holdings Ltd. operates as a digital financial services platform and technology company primarily in Brazil, Mexico, and Colombia. The company belongs to the Finance sector, which has an average price to earnings (P/E) ratio of 14.34 and an average price to book (P/B) ratio of 1.57. In contrast, Nu has a trailing 12 month P/E ratio of -58.6 and a P/B ratio of 4.5.
P/B ratios are calculated by dividing the company's market value by its equity's book value. Equity refers to all of the company's assets minus its liabilities. Traditionally, a P/B ratio of around 1 shows that a company is fairly valued, but owing to consistently higher valuations in the modern era, investors generally compare against sector averages.
Nu has moved -32.2% over the last year compared to -5.6% for the S&P 500 — a difference of -27.0%. Nu has a 52 week high of $7.48 and a 52 week low of $3.26.
