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    Why XP (XP) Is Up 6.3% After Strong Q2 Results And U.S. Banking Ambitions

    Simply Wall St·08/22/2026 22:23:14
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    • XP Inc. has already reported its second-quarter 2026 results, with revenue rising to R$4.85 billion and net income reaching R$1.38 billion, alongside modestly higher diluted EPS and the completion of two share repurchase programs totaling about R$1.21 billion.
    • Management also revealed it is weighing the creation or acquisition of a U.S. banking operation, a move that could reshape XP’s business mix and broaden its international reach while adding regulatory and execution complexity.
    • We’ll now examine how XP’s stronger-than-expected second-quarter results and U.S. banking ambitions affect the existing investment narrative for the company.

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    XP Investment Narrative Recap

    To own XP, you need to believe its Brazilian platform can keep compounding client assets and fee income, even as competition and regulation pressure margins. The stronger Q2 2026 numbers and talk of a potential U.S. banking move do not materially change the near term catalyst, which still hinges on reigniting net new money from key client segments, or the main risk, which remains fee compression from banks and fintechs.

    The most relevant announcement here is XP’s completion of roughly R$1.21 billion in share repurchases across two programs. This capital return matters because it amplifies the impact of any earnings progress on a per share basis, at a time when the stock trades at a clear discount to many peers on earnings multiples. If XP can pair disciplined buybacks with improving client asset trends, that combination could become a meaningful short term driver for the story.

    Yet behind the stronger quarter and buybacks, investors should still be paying close attention to the risk that fee compression and rising costs could eventually...

    Read the full narrative on XP (it's free!)

    XP's narrative projects R$25.8 billion revenue and R$7.1 billion earnings by 2029. This requires 12.4% yearly revenue growth and roughly a R$1.9 billion earnings increase from R$5.2 billion today.

    Uncover how XP's forecasts yield a $23.17 fair value, a 38% upside to its current price.

    Exploring Other Perspectives

    XP 1-Year Stock Price Chart
    XP 1-Year Stock Price Chart

    Some of the lowest tier analysts were already cautious, assuming XP’s revenue would grow to about R$24.5 billion and earnings to roughly R$7.2 billion, and they worry that intensifying fee compression and new technologies could weigh on XP’s model much more than consensus expects, so if you are thinking about XP today, it is worth exploring how these more pessimistic views might shift in light of the latest earnings and U.S. banking ambitions.

    Explore 3 other fair value estimates on XP - why the stock might be worth just $22.05!

    Decide For Yourself

    Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

    • A great starting point for your XP research is our analysis highlighting 5 key rewards that could impact your investment decision.
    • Our free XP research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate XP's overall financial health at a glance.

    No Opportunity In XP?

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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.