Jefferies Initiates XP Inc (XP) With a Buy

Core Viewpoint - XP Inc. is considered one of the most undervalued foreign stocks to buy, with analysts from Jefferies and UBS issuing Buy ratings and setting price targets of $22 and $25 respectively [1][2]. Group 1: Competitive Position and Strengths - XP Inc. has a strong competitive position in the Brazilian market, operating through a multi-brand ecosystem that provides access to digital platforms and personalized advisory services [2][3]. - The company boasts a 26% return on equity and a CET1 capital ratio of approximately 18.5%, with about 50% of Brazil's independent financial advisors partnering with XP [3]. Group 2: Financial Outlook and Valuation - Jefferies views XP Inc. as attractively valued, particularly in the context of peak interest rates, and expects the company to be a top gainer from potential rate cuts [4]. - The firm anticipates a 15% compound annual growth rate (CAGR) in revenue and earnings through 2030, with return on equity projected to rise from 24% in 2025 to 28% by 2030 [4]. Group 3: Product Offering - XP Inc. is a technology-enabled platform that offers a variety of investment, credit, and pension products at low fees, covering diverse asset classes including equities, fixed income, and alternatives across both public and private markets [5].