XP (XP) AI Stock Analysis

• Market Cap: $10.62B
• Dividend Yield: 1.1%
• Average Volume (3M): 7.21M
• Price to Earnings (P/E): 11.5
• Beta (1Y): 1.13
• Revenue Growth: -3.47%
• EPS Growth: 7.48%
• Country: US
• Employees: 6,834
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Capital Markets
• EPS (TTM): 0.49
• Shares Outstanding: 423,566,440
• 10 Day Avg. Volume: 7,320,705
• 30 Day Avg. Volume: 7,211,348
• PEG Ratio: 0.48
• Price to Book (P/B): 2.01
• Price to Sales (P/S): 2.66
• P/FCF Ratio: 3.99
• Enterprise Value/Market Cap: 6.90
• Enterprise Value/Revenue: 4.06
• Enterprise Value/Gross Profit: 10.13
• Enterprise Value/Ebitda: 11.57
• 1Y Price Target: $23.25
• Price Target Upside: 1.31% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: $25.00 ▲(8.93% Upside)
• Action: Downgraded Date: 02/18/26
• Date: Action: Downgraded 02/18/26

The score is driven primarily by solid financial quality (strong profitability and decent cash conversion, with improved leverage) tempered by volatility and a notable 2025 revenue decline. Technicals are supportive with a clear uptrend and positive momentum, and valuation looks reasonable on a moderate P/E. Earnings call commentary is broadly constructive with maintained 2026 guidance, but execution and market-condition risks remain meaningful.

Positive Factors

Large client asset base

A ~BRL 2.1 trillion asset base provides durable scale for fee income, cross‑sell and client stickiness. Large AUC supports recurring asset‑based fees, underwriting distribution depth and adviser economics, sustaining structural revenue and advisory franchise resilience over the medium term.

High profitability and margins

Sustained high EBT margins and expanded profitability indicate strong earnings power and pricing/operational leverage. Robust margins support free cash flow, capacity for capital returns and reinvestment, and provide a cushion against cyclical revenue weakness over the next several quarters.

Growing wholesale & issuer franchise

Rapid growth in corporate/issuer services diversifies revenue beyond retail trading and custody. A stronger wholesale franchise generates higher‑margin, less seasonally correlated fees, enhances cross‑sell into institutional clients and reduces dependence on retail volume cycles over the medium term.

Negative Factors

Top-line volatility and 2025 decline

A material revenue contraction in 2025 highlights sensitivity to market activity and mix shifts, reducing visibility into growth. Persistent top‑line volatility complicates investment planning and makes operating‑leverage gains harder to realize, raising execution risk for ambitious multi‑quarter targets.

Retail net new money pressure

SMB outflows and retail NNM weakness erode the growth of fee‑bearing assets and can compress margins if trading/take rates fall. Slower organic asset accumulation raises dependence on wholesale deals and buybacks, weakening the long‑term predictability of revenue from core retail segments.

Leverage volatility and rising RWA

Higher warehousing and RWA growth increase capital needs and amplify sensitivity to credit/market shocks. Although leverage improved in 2025, prior swings show balance‑sheet volatility that can constrain capital returns or force conservative risk tightening during stress, impacting growth optionality.

XP Business Overview & Revenue Model

Company Description

XP Inc. provides financial products and services in Brazil. It offers securities brokerage, private pension plans, commercial, and investment banking products, such as loan operations and transactions in the foreign exchange markets and deposits; product structuring and capital markets services for corporate clients and issuers of fixed income products; advisory services for mass-affluent and institutional clients; and wealth management services for high-net-worth customers and institutional clients. The company also offers Xpeed, an online financial education portal that offers seminars, classes, and learning tools to help teach individuals on topics, such as basics of investing, techniques, and investment strategies, as well as insurance brokerage services. In addition, it operates XP Platform, an open product platform that provides clients to access investment products in the market, including equity and fixed income securities, mutual and hedge funds, private equity, structured products, credit cards, loan operations, life insurance, pension plans, real-estate investment funds, and others. The company was founded in 2001 and is based in São Paulo, Brazil.

How the Company Makes Money

XP generates revenue through several key streams, primarily from brokerage fees on trades executed by clients on its platform. The company charges commissions on securities transactions, which form a significant portion of its revenue. Additionally, XP earns money through asset management fees from its investment funds and by providing advisory services to clients for a fee. The company also benefits from interest income on cash balances held by clients and from proprietary trading activities. Strategic partnerships with financial institutions enhance XP's product offerings and customer base, further contributing to its earnings.

XP Financial Statement Overview

Summary

Above-average profitability and generally solid cash conversion, with a balance sheet that improved meaningfully in 2025 as leverage declined. Offsetting this, results have been volatile and the sharp 2025 revenue decline is a key near-term risk signal.

Income Statement

Profitability is strong, with 2025 net margins around 28% and healthy operating profitability versus prior years. Revenue growth has been volatile: strong expansion in 2020–2021, moderate growth in 2022–2024, then a sharp revenue decline in 2025, which is the key near-term concern. Overall, XP shows good earnings power, but the 2025 top-line contraction reduces confidence in the current trajectory.

Balance Sheet

Leverage improved materially in 2025, with debt-to-equity dropping to ~0.9 from very elevated levels in 2023–2024, and equity continuing to build. However, the balance sheet has shown significant swings in debt levels over time (including extremely high leverage in 2024), and total assets are large relative to equity, which can amplify risk in a capital-markets business. Net: trending better, but historical leverage volatility keeps the score mid-range.

Cash Flow

Cash generation is generally solid, with positive operating and free cash flow in most years and free cash flow closely tracking net income (near 1x in 2022–2025), suggesting earnings quality is decent. The main weakness is volatility: 2021 showed negative operating and free cash flow, and 2025 free cash flow dropped sharply versus 2024. Overall cash flow is good, but consistency is uneven.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	17.77B	19.87B	14.82B	14.18B	12.97B
Gross Profit	12.29B	1.89B	1.62B	1.10B	2.06B
EBITDA	6.25B	6.03B	4.81B	4.05B	4.18B
Net Income	5.17B	4.51B	3.90B	3.58B	3.59B
Balance Sheet
Total Assets	396.53B	347.46B	249.04B	192.03B	139.34B
Cash, Cash Equivalents and Short-Term Investments	10.35B	74.91B	54.41B	41.30B	36.22B
Total Debt	20.96B	115.13B	68.56B	35.52B	28.21B
Total Liabilities	372.98B	327.41B	229.59B	174.99B	124.92B
Stockholders Equity	23.55B	20.04B	19.45B	17.04B	14.42B
Cash Flow
Free Cash Flow	11.84B	10.85B	7.93B	1.68B	-4.37B
Operating Cash Flow	12.04B	11.18B	8.13B	1.80B	-4.02B
Investing Cash Flow	-715.97M	-1.67B	538.81M	-371.28M	-1.15B
Financing Cash Flow	-4.93B	-5.78B	-4.39B	-200.30M	6.64B

XP Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 22.95
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For XP, the sentiment is Positive. The current price of 22.95 is above the 20-day moving average (MA) of 20.08, above the 50-day MA of 18.28, and above the 200-day MA of 18.09, indicating a bullish trend. The MACD of 0.79 indicates Negative momentum. The RSI at 73.32 is Negative, neither overbought nor oversold. The STOCH value of 89.19 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for XP.

XP Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EVR	70 Outperform	$12.80B	23.56	31.66%	0.95%	27.00%	63.47%
MKTX	70 Outperform	$6.55B	26.52	19.46%	1.66%	3.96%	-20.33%
XP	69 Neutral	$10.62B	11.49	24.57%	1.10%	-3.47%	7.48%
SF	69 Neutral	$12.27B	20.53	11.72%	1.43%	7.54%	2.73%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
PIPR	62 Neutral	$5.82B	20.78	21.65%	1.63%	12.77%	36.43%
FRHC	52 Neutral	$6.88B	2,843.40	0.20%	―	7.40%	-97.69%

XP Corporate Events

XP Inc. Posts Solid 4Q25 Results as Assets Under Custody Hit R$1.5 Trillion

XP Inc., a leading Brazilian tech-enabled investment platform, reported its fourth-quarter and full-year 2025 results on February 12, 2026, highlighting its client-centric, open-architecture model and the evolution of its advisor network into full financial planners. The firm emphasized its use of technology and artificial intelligence to enhance advisor productivity, personalize client service, and scale high-quality wealth planning historically reserved for private banking clients.

In 2025, XP’s assets under custody reached about R$1.5 trillion, revenues grew 8%, and net income and EPS rose 15% and 18%, respectively, despite a difficult environment marked by shorter investment durations and lower market activity. Management said recent challenges led to stronger governance and controls, while the wholesale bank, built over the past five years, became one of Brazil’s most relevant franchises and a key competitive edge by deepening integration between corporate, institutional, and retail operations.

The company reported entering 2026 with a temporarily elevated capital base, stating it intends to optimize capital allocation while maintaining flexibility and shareholder returns. XP also outlined plans to invest further in its core strategic pillars of investment leadership, complementary retail offerings, and wholesale banking, including expanding its sales force, technology and marketing capabilities, and pursuing opportunities in SME banking and credit with disciplined risk management.

The most recent analyst rating on (XP) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on XP stock, see the XP Stock Forecast page.

XP Inc. Reshapes Control Structure as New Executives Join XP Control LLC

On February 12, 2026, XP Inc. announced a planned realignment of ownership interests in XP Control LLC, its controlling entity, as part of a leadership transition. Senior executives Thiago Maffra and José Berenguer are expected to become voting partners in the control vehicle, joining founder Guilherme Benchimol and other existing leaders, while three long-standing partners will have their voting interests acquired for cash and Class A shares.

As a result of the transaction, XP Control LLC’s beneficial ownership of XP’s Class A shares will fall to 18% on an as-converted basis, but it will continue to command at least 69% of the company’s voting power, with Benchimol remaining the majority unitholder. XP said the reconfiguration, which keeps the exiting partners on its board despite their lack of executive roles since 2024, is intended to reinforce governance, stabilize its control structure and underpin long-term value creation for stakeholders.

The most recent analyst rating on (XP) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on XP stock, see the XP Stock Forecast page.

XP Inc. Receives Clean Audit Opinion on 2025 IFRS Consolidated Results

XP Inc. disclosed its audited consolidated financial statements for the year ended December 31, 2025, with PricewaterhouseCoopers issuing an unqualified opinion that the accounts fairly present the group’s financial position and performance under IFRS Accounting Standards. The audit highlighted key areas of focus, including fair value measurement of low‑liquidity level 3 instruments, revenue recognition from core service lines and the resilience of XP’s information technology controls, indicating that management’s models, processes and systems were deemed consistent with market practice and reliable for financial reporting as of 2025.

The auditor’s emphasis on complex valuation techniques, high‑volume service revenue streams and technology‑dependent controls underscores the operational sophistication and risk profile of XP’s platform‑based business model. For investors and regulators, the clean audit opinion and comfort on IT and control environments support confidence in the integrity of XP’s reported numbers and its ability to manage valuation, operational and fraud‑related risks across its expanding Brazilian financial services operations.

The most recent analyst rating on (XP) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on XP stock, see the XP Stock Forecast page.