Investors Buy High Volume of XP Call Options (NASDAQ:XP)

Key Points

• XP saw unusually high options activity, with 75,767 call options purchased—nearly four times its typical daily volume.
• Analysts remain broadly positive, with five Buy ratings and two Holds; the stock has a “Moderate Buy” consensus and an average price target of $28.80.
• XP shares rose 3.4% to $31.27, while its latest quarterly results exceeded expectations for both earnings and revenue. Institutional investors own approximately 59.15% of the company.

XP Inc. (NASDAQ:XP - Get Free Report) was the target of unusually large options trading activity on Tuesday. Stock traders bought 75,767 call options on the stock. This represents an increase of 297% compared to the typical daily volume of 19,087 call options.

Analysts Set New Price Targets

A number of research analysts have recently weighed in on the stock. Weiss Ratings raised shares of XP from a "hold (c-)" rating to a "hold (c)" rating in a research note on Wednesday, September 2nd. JPMorgan Chase & Co. raised their price target on XP from $26.00 to $38.00 and gave the stock an "overweight" rating in a research report on Tuesday, October 6th. UBS Group boosted their price target on XP from $25.00 to $37.00 and gave the stock a "buy" rating in a report on Thursday, October 8th. Itau BBA Securities upgraded XP from a "market perform" rating to an "outperform" rating and set a $22.00 price objective on the stock in a research report on Monday, August 31st. Finally, Citigroup increased their price objective on XP from $23.00 to $25.00 and gave the company a "buy" rating in a research note on Tuesday, September 29th. Five research analysts have rated the stock with a Buy rating and two have given a Hold rating to the stock. According to data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and a consensus price target of $28.80.

XP Trading Up 3.4%

NASDAQ XP traded up $1.01 during mid-day trading on Tuesday, reaching $31.27. 7,270,530 shares of the stock were exchanged, compared to its average volume of 6,653,382. The stock has a market capitalization of $16.81 billion, a PE ratio of 16.37, a PEG ratio of 0.78 and a beta of 1.01. The company has a debt-to-equity ratio of 0.07, a quick ratio of 4.80 and a current ratio of 4.80. XP has a 1-year low of $14.80 and a 1-year high of $32.73. The business's fifty day simple moving average is $21.36 and its 200 day simple moving average is $18.79.

XP (NASDAQ:XP - Get Free Report) last issued its quarterly earnings results on Monday, August 17th. The company reported $0.53 earnings per share for the quarter, topping analysts' consensus estimates of $0.50 by $0.03. XP had a return on equity of 22.19% and a net margin of 27.20%. The company had revenue of $943.55 million for the quarter, compared to analyst estimates of $935.15 million. During the same quarter in the prior year, the company posted $2.46 EPS. The business's revenue for the quarter was up 8.3% compared to the same quarter last year. On average, research analysts anticipate that XP will post 2.09 earnings per share for the current fiscal year.

Insider Buying and Selling

In related news, Director Bruno Constantino Alexandre dos Santos sold 123,257 shares of the stock in a transaction dated Wednesday, September 16th. The shares were sold at an average price of $19.58, for a total value of $2,413,372.06. Following the sale, the director directly owned 1,500,000 shares of the company's stock, valued at approximately $29,370,000. This represents a 7.59% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink.

Institutional Trading of XP

A number of hedge funds have recently added to or reduced their stakes in XP. EverSource Wealth Advisors LLC increased its stake in shares of XP by 46.2% during the 1st quarter. EverSource Wealth Advisors LLC now owns 2,471 shares of the company's stock valued at $47,000 after acquiring an additional 781 shares during the last quarter. Parallel Advisors LLC grew its holdings in XP by 117.3% in the first quarter. Parallel Advisors LLC now owns 3,288 shares of the company's stock valued at $63,000 after purchasing an additional 1,775 shares during the period. Integrated Wealth Concepts LLC purchased a new stake in XP in the second quarter valued at approximately $91,000. Strategic Investment Advisors MI purchased a new stake in XP in the first quarter valued at approximately $126,000. Finally, Deltec Asset Management LLC acquired a new position in XP during the first quarter worth approximately $248,000. 59.15% of the stock is owned by institutional investors and hedge funds.

About XP

XP Inc is a Brazilian financial services company that operates a technology-driven investment and financial products platform. Through its digital channels and network of advisors, the company offers access to products including stocks, bonds, investment funds, exchange-traded funds, insurance and retirement products. It serves individual investors, businesses, institutional clients and independent financial advisors.

The company's principal brands and businesses include XP, Rico and Clear, which provide brokerage and investment services to different customer segments.

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