XP · XP
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $18.94
Note written ·
Price against the kill line
18.2% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $18.94, on record since 11 November 2026. The shares are down 1.3% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $18.94, near the 200-day average of closes, which would show the shares leading the S&P 500 again; third-quarter 2026 net inflows above the second quarter's R$28 billion would also point to the shares leading.
Research onlyNot in the portfolio.
Catalyst
Key figures from the filings · Financials
Filed figures are not available: no quarterly report in US GAAP with the SEC (a foreign filer reports on Form 20-F or 40-F).
All filed numbers
What XP reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): the share of shares outstanding is not available, 1.4 days of average trading to cover, +18.5% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $2.4M |
| 12 monthsfrom | $0 | $2.4M |
The thesis
XP Inc. is more likely to lag the S&P 500 over the next three months. Brazil's fiscal and interest-rate outlook worsened after Lula won the 25 October 2026 runoff, and four brokers have cut targets or ratings since. The third-quarter report, due after the US close on 17 November 2026, settles whether client net inflows held near the second quarter's R$28 billion.
The shares closed at $15.04 on 12 November 2026, below both the 50-day average of $21.85 and the 200-day average of $18.91, per adjusted daily closes. The 52-week closing low is $14.04, set on 2 November 2026. Over the six sessions from 5 November to 12 November 2026 the closes stayed between $14.78 and $15.47, so the post-runoff drop has stopped deepening without producing a recovery.
The 3-month price change is −4.9%, measured against the $15.82 close on 14 August 2026. Everything the shares gained in the October rally before the vote is gone.
Bullish and bearish views on XP Inc.
The bull case on XP Inc. (XP), in brief: Goldman Sachs still rates the shares Buy. The bear case: brokers keep cutting targets.
Bull case
- Goldman Sachs still rates the shares Buy. Goldman Sachs maintained its Buy rating and lowered its price target to $31 on 12 November 2026, per company news headlines. That target is about twice the $15.04 close of the same session.
- Valuation already reflects a downturn. InvestingPro put XP's price-to-earnings ratio at 8.41 in Investing.com's 29 October 2026 report. Morgan Stanley's Jorge Kuri said on 29 October 2026 that low valuations give some downside support, even as he cut his rating.
- Client money was arriving before the vote. Net inflows were R$28 billion in the second quarter of 2026, against R$10 billion a year earlier and R$14 billion in the first quarter, per the company's Form 6-K of 17 August 2026. Those flows came with the Selic rate near 14%.
- Earnings were still growing. Second-quarter 2026 net revenue rose 9% from a year earlier to R$4,884 million, and net income rose 5% to R$1,384 million, per the 17 August 2026 Form 6-K.
Bear case
- Brokers keep cutting targets. Citigroup's Gustavo Schroden cut XP to Neutral and his target to $15 from $25 on 27 October 2026, per GuruFocus. Morgan Stanley cut to Equalweight and its target to $19 from $23 on 29 October 2026, per Investing.com. UBS kept Buy but cut its target to $23 from $37, per Benzinga on 6 November 2026. Goldman's cut to $31 came on 12 November 2026.
- Lower rates are pushed further out. Morgan Stanley said on 29 October 2026 that policy continuity, fiscal uncertainty and a higher cost of capital could delay a recovery in risk appetite, trading activity and capital-markets issuance, per Investing.com. Those activities drive XP's revenue.
- XP fell harder than Brazil. XP dropped 46% before the open on 26 October 2026, while the iShares MSCI Brazil exchange-traded fund closed down 21.7% that day, per Benzinga. The shares move as a leveraged proxy for Brazilian sentiment.
- A director sold before the vote. Director Bruno Constantino Alexandre Dos Santos sold 123,257 shares at $19.58 on 16 September 2026, per an SEC Form 4 filed 17 September 2026.
Price setup
The $15.04 close on 12 November 2026 sits 54.0% below the 52-week intraday high of $32.73 set on 12 October 2026. It is $0.99 above the 52-week closing low of $14.04 from 2 November 2026, a gap that the adjusted daily closes show as less than 7%.
The 200-day average of $18.91 and the 50-day average of $21.85 both sit above the shares. A move back above the 200-day average would be the first sign that buyers are returning at higher prices.
The price already reflects a sharp reassessment. The shares trade at roughly Citigroup's $15 target and below Morgan Stanley's $19, UBS's $23 and Goldman's $31 targets. The 17 November 2026 report is the next event that can move the shares sharply in either direction.
Catalysts ahead
- 17 November 2026: XP Inc. third-quarter 2026 results, after the US close, webcast at 5 p.m. ET. Shows whether net inflows held near the second quarter's R$28 billion through the election and gives management's first comments on client behaviour after the runoff.
What would change the view
A daily close above $18.94, near the 200-day average of closes, which would show the shares leading the S&P 500 again; third-quarter 2026 net inflows above the second quarter's R$28 billion would also point to the shares leading.
What it trades with
XP trades with Brazilian financial and consumer ADRs. On 26 October 2026, Benzinga reported pre-market falls of 34.7% for Inter & Co, 33.8% for StoneCo and 14.1% for MercadoLibre, alongside XP's 46%. Morgan Stanley downgraded the exchange operator B3 on 29 October 2026, the same day as XP, for the same post-election reasons.
XP reports in reais, so a weaker real against the dollar cuts the dollar value of its earnings apart from business results. Moves in the iShares MSCI Brazil exchange-traded fund and the real are the closest daily guides to XP's direction outside its own news.
The evidence, claim by claim (8)
- Goldman Sachs maintained its Buy rating on XP and lowered its price target to $31. Company news headlines, 12 November 2026 · as of
- UBS kept its Buy rating on XP and cut its price target to $23 from $37. Benzinga, 6 November 2026 · as of
- Morgan Stanley's Jorge Kuri downgraded XP to Equalweight from Overweight and cut the target to $19 from $23, citing fiscal uncertainty and a higher cost of capital after the election. Investing.com, 29 October 2026 · as of
- Citigroup's Gustavo Schroden downgraded XP from Buy to Neutral and cut the price target to $15 from $25. GuruFocus, 27 October 2026 · as of
- XP fell 46% before the open on 26 October 2026 after Lula's runoff win; the iShares MSCI Brazil exchange-traded fund closed the day down 21.7%. Benzinga, 26 October 2026 · as of
- Total net inflows were R$28 billion in the second quarter of 2026, versus R$10 billion a year earlier and R$14 billion in the first quarter; net revenue was R$4,884 million and net income R$1,384 million. XP Inc. second-quarter 2026 results, Form 6-K · as of
- Director Bruno Constantino Alexandre Dos Santos sold 123,257 shares at $19.58 on 16 September 2026. SEC Form 4 filed 17 September 2026 · as of
- XP plans to release third-quarter 2026 results after the US market close on 17 November 2026, with a webcast at 5 p.m. ET. XP results schedule notice, via rallies.ai · as of
Sources
- Morgan Stanley cuts XP Inc. stock rating on Brazil outlook concerns · investing.com ·
- XP Downgraded by Citigroup -- Price Target Lowered to $15.00 · gurufocus.com ·
- XP schedules third-quarter 2026 results webcast · rallies.ai
Related · shared themes
CHA
Chagee Holdings
Chagee Holdings is modestly more likely to lead the S&P 500 over three months: its shares cleared $14.00 on a $1.95 special dividend. The…
BAK
Braskem
Braskem's creditor talks have no agreement and shareholders withdrew their funding offer on 6 November 2026, so heavy dilution for the…
INTR
Inter
Inter & Co.'s shares are more likely to lag the S&P 500 over three months: profit grew 26% in the 12 November 2026 report, but late overdue…
ITUB
Itau Unibanco Holding
Itaú Unibanco still earns a 23.6% return on equity, in line with forecasts, but its US shares trade on Brazil's fiscal risk and sit at…