Morgan Stanley lowered the firm’s price target on XP Inc. (XP) to $18 from $21 and keeps an Equal Weight rating on the shares. The firm cut estimates to reflect “higher-for-longer” Selic rates. Selic rate forecasts have continued to move up over the last 30 days, prompting another round of earnings cuts to XP estimates, the analyst tells investors in a research note. Morgan Stanley believes XP’s long-term attractive secular opportunity and discounted valuation justify an Equal Weight rating at this time. Consensus estimates seem too bullish on 2025, and downward earnings revisions could be a headwind for short-term stock performance, it adds.
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