XP Inc: Buy Rating Affirmed Amid Attractive Valuation and Future Interest Rate Benefits

Gustavo Schroden, an analyst from Citi, maintained the Buy rating on XP. The associated price target was raised to $23.00.

Gustavo Schroden has given his Buy rating due to a combination of factors including XP’s attractive valuation and the potential benefits from anticipated lower interest rates in the future. Despite recent downward revisions in earnings estimates for 2025 and 2026, Schroden expects a positive earnings growth trajectory, with a 13% increase this year and an 8% rise in 2026.
Schroden acknowledges the short-term challenges, such as weaker-than-expected issuer services and a potential miss on revenue guidance. However, he remains optimistic about XP’s ability to achieve its EBT margin range through stringent expense management. Additionally, the expected reduction in interest rates by 2026 could positively impact XP’s stock performance, supporting Schroden’s Buy recommendation.