Nu Holdings Ltd. (Nu Holdings (NU)) had a rough Tuesday, falling sharply even as the broader market posted gains. The Russell 2000 was up 0.59% and the Nasdaq rose 0.28%, so this wasn't a case of everything getting sold off — investors were specifically sour on Nu.
The main culprit? A downgrade from Bank of America Securities. The bank moved its rating on Nu to Underperform from Neutral and cut its price target to $10 from $16. That's a pretty dramatic cut, and it's a big reason the stock is down nearly 9%.
But here's where it gets interesting: Wall Street as a whole still likes the stock. The consensus rating is Buy, and the average analyst price target is $16.73 — well above where the stock is trading now. UBS, for example, maintained its Buy rating on May 20, even as it trimmed its price target to $16.90. And in April, CICC initiated coverage with an Outperform rating and an $18 target. So BofA is the outlier here, not the consensus.
New CFO, Same Strategy
On Monday, Nu announced a leadership change: Rob Livingston will become the new chief financial officer, effective July 13. Livingston comes from Visa Inc. (Visa (V)), where he was CFO for North America. He replaces Guilherme Lago, who will stick around as a special advisor.
The company was quick to say this won't change anything about how it operates. The press release emphasized that the operating model, risk framework, and long-term strategy remain unchanged. Livingston will oversee global finance, including capital management, investor relations, tax, reporting, and corporate development.
Leadership changes can sometimes spook investors, but Nu seems to be signaling continuity. Still, the timing — right after a downgrade — doesn't help.
The Technical Picture: Still Ugly
If you look at the charts, Nu has been in a downtrend for a while. The stock is trading 11.8% below its 20-day moving average of $13.21 and a whopping 24.9% below its 200-day moving average of $15.50. The 20-day SMA is below the 50-day SMA, and a death cross (50-day below 200-day) formed back in April. That's technical-speak for "the trend is not your friend."
There is one small glimmer of hope: the MACD indicator is above its signal line, and the histogram is positive. In plain English, that means selling pressure might be easing compared to the prior downswing. But it's not a guarantee of a reversal — just a sign that the bleeding might be slowing.
Key resistance to watch is $13.50, a round number near the short-term moving averages. If the stock can't get back above that, any rallies will look like counter-trend bounces.
Price Action: As of Tuesday's close, Nu Holdings shares were down 8.97% at $11.82, just a hair above its 52-week low of $11.71. It's a tough spot for a company that still has plenty of fans on Wall Street.
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