XP Asymmetric Upside with Potential ~13% Yield Support

Research evidence excerpt

XP Asymmetric Upside with Potential ~13% Yield Support

J P M O R G A N Latin America Equity Research

29 June 2026

XP

Asymmetric Upside with Potential ~13% Yield Support

We see a favorable risk/reward for XP and we believe the market may be Latin American Financials

ACoverlooking its ability to deliver attractive shareholder returns. XP has limited Yuri R Fernandes

direct exposure to a Brazilian credit cycle and offers upside optionality if the rate (1-212) 622-3400

outlook improves. If rates stay where they are, capital returns alone could support yuri.r.fernandes@jpmorgan.com

the stock in our view: at current ~7x 2027E, we see roughly a ~13% yield via J.P. Morgan Securities LLC

dividends and/or buybacks. The company is currently operating with ~21% BIS Guilherme Grespan

and has guided to end 2026 within its 16-19% range. Based on our scenarios, we (55-11) 4950-3058

guilherme.grespan@jpmorgan.com

estimate XP could unlock ~R$2.5–8bn in excess capital (including organic Banco J.P. Morgan S.A.

generation). Our base case is that XP could distribute ~R$5-5.5bn or ~12-13%

Fernanda Sayao

yield - among the highest in our coverage universe. While BTG remains our (55-11) 4950-6588

preferred name in capital markets, we continue to like XP due to its asymmetric fernanda.sayao@jpmchase.com

valuation, currently trading at ~7.7x 2026E P/E or ~7.1x 2027E and ~1.6x P/BV Banco J.P. Morgan S.A.

for ~23% ROE. Diego Marquez Antonio

(52-55) 5339-94899

• We think the market may be overlooking XP’s ability to deliver an diego.marquez@jpmorgan.com

attractive shareholder yield. XP is currently operating with a ~21% BIS ratio J.P. Morgan Casa de Bolsa, S.A. de C.V., J.P.

Morgan Grupo Financiero

and has guided to end the year within its 16–19% target range. To estimate