XP could skyrocket if these 2 things go well

XP could skyrocket if these 2 things go well
XP could skyrocket if these 2 things go well

In the roughly $117 billion global investment banking market, companies based in more established markets tend to get all the attention. However, ILooking beyond those standard operators may reveal investment opportunities, as some of the fastest-growing financial platforms are emerging from markets that are often an afterthought for American investors.

Based in Brazil experience (NASDAQ:XP)which calls itself a “one-stop shop” for financial solutions, is one such company. It offers brokerage accounts, advisory services, offshore investments and asset management, as well as retail and wholesale banking services. It also has almost 5 million clients and carries out 50,000 fixed income transactions per day. In that context, two key factors could determine where its share price will go.

Will AI create the world’s first billionaire? Our team just published a report on a little-known company called “Indispensable Monopoly” that provides critical technology that both Nvidia and Intel need. Continue “

Image source: Getty Images.

In the fourth quarter of 2025, XP reported total assets of just over 2 trillion reais ($400 billion), a 22% year-over-year increase. Its assets under management and assets under management increased 35% and 44% year over year, respectively, in the quarter. That highlights a diversified economic base on which the company can continue to build. If XP can continue to expand that asset stack, will strengthen its competitive position in Brazil.

Clients who manage more of their wealth through XP are likely to be more engaged with their advisors and stay with the financial services firm. The strength of your asset growth is also a topic of conversation to attract new clients.

The expansion of the ecosystem also directly influences the growth of these assets, as the company enjoys many cross-selling opportunities in insurance, retirementand credit cards.

XP’s net revenue rose 10% in the fourth quarter to 1.3 billion reais ($247 million), while full-year net revenue rose 15% to 5.2 billion reais ($990 million). If it can continue its recent run of profitability, that could go a long way toward convincing markets that its results will last.

For the results to continue rising, the Brazilian The company is leveraging artificial intelligence (AI) to augment, rather than replace, its advisors. XP wants its advisors to generate more value by spending more time with clients and less on operational work.

As more customers adopt wealth planning tools and sign up for other products in the growing XP ecosystem, the company will be able to generate greater recurring revenue without increasing costs.

The long-term outlook for XP looks promising and its forward price-to-earnings (P/E) ratio of around 10 is attractive. While it’s not a perfect comparison, its US-based peer Carlos Schwab It trades at a Forward P/E just above 16.

With all of the above in mind, there are a few details to consider before adding XP to your portfolio. Since the close of its first trading session in 2019, its shares have fallen 41%. That fall was driven due to a combination of post-IPO overvaluation and Brazil’s high interest rates. By 2026, CEO Thiago Maffra also expects a “challenging environment.”

XP may attract patient investors who have a higher risk tolerance, but anyone buying this stock should be ready for obstacles in the way.

Before you buy shares in XP, consider this:

He Varied and Dumb Stock Advisor The analyst team has just identified what they believe are the 10 best stocks for investors to buy now… and XP was not one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you would have $424,262!* Or when NVIDIA made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you would have $1,163,635!*

Now, it is worth noting stock advisor The total average performance is 904.%: An overwhelming outperformance of the market compared to the S&P 500’s 194%. Don’t miss the latest Top 10 list, available with Stock Advisorand join an investing community created by individual investors for individual investors.

See the 10 actions »

*Stock Advisor returns from February 21, 2026.

Charles Schwab is an advertising partner at Motley Fool Money. Jack Delaney has no position in any of the stocks mentioned. The Motley Fool recommends Charles Schwab and recommends the following options: Short $100 calls in March 2026 on Charles Schwab. The Motley Fool has a disclosure policy.

XP Could Soar If These Two Things Go Right was originally published by The Motley Fool

Source link