December has come and gone - and the year is up. It is time for my final journal entry of the year. I have added a new position to the portfolio and will discuss why.

Moves

• On January 2nd I started a new position in Nubank (NU) at an average price of $11.68.

Performance

Dividend overview

I received a total of $133.21 in dividends before taxes for December 2024, down 17.04% compared to the same month last year at $162.33.

Commentary & Review

Adding Nubank

As part of my strategy to diversify away from the Western world, Nubank (NU), a Brazilian neobank became the first new pick to join my portfolio in this regard. Nubank operates primarily in its home country, although it has also been growing its market share in Mexico and Columbia. It is the largest fintech bank in Latin America, serving nearly 100 million customers by now. Trading above a 30 P/E it is not necessarily cheap for a bank, however considering its growth and forward P/E of about 18, makes for a decent valuation in comparison to the index average.

However, comparing Nubank to traditional banks would not be fair: they operate entirely through digital channels, in a market where 72% of the population own a smartphone, yet 45% have never had a bank account. This makes for an incredibly big opportunity in a continent of nearly 700 million people and offering every service through a smartphone app lowers customer acquisition costs drastically. Nubank spends about $7 to acquire a new customer, whereas other banks for comparison, such as otherwise also fully digital SoFi (SOFI) spend about $300.

Nubank is betting big on credit - which carries a certain risk, however, as about 80% of its market population has never been issued credit before, the opportunity is immense. The region is experiencing economic growth, which can lead to more discretionary spending. Nubank is competing with a bunch of old, dusty, however, well-established traditional banks and I have high conviction that they, in good time, will absolutely demolish these.

It is also a region known for issues with corruption and political instabilities, but as outlined in my previous post, I think the same will now increasingly be true for the future of the Western world. I cannot claim to be deeply familiar with either the market Nubank operates in or the customer experience - but what I have done is check out the app for myself, sideloading it to my phone, and I came away extremely impressed with its fluidity, visuals, and approachability, as a UX designer by trade.

The stock was first presented to me about 2 years ago at an investor conference and I have never really been able to let go of the excitement I felt when presented for its disrupting premise and well-tuned financials, considering its early stage. It is also worth noting that Berkshire Hathaway (BRK) invested in the company pre-IPO in 2021.

Bezos is back

A small, yet significant development caught my attention this month. During an interview given at The New York Times Dealbook Summit in December, Amazon (AMZN) founder Jeff Bezos revealed that he is now (perhaps always was) working full-time at the organization still. This came as a surprise to many, including myself, and made the news rounds too. While Amazon’s financial strategy has evolved to become slightly less aggressive (which is for the better, in my opinion), since he stepped down as CEO, it is nice to know that he is around, in a bigger capacity than just as an advisory role on the board. Having made up with Trump, I think Amazon is in a for a great few years, particularly as they stand to uniquely benefit from the rollout of autonomous driving and robots (delivery + logistics).

For some of these reasons, I have decided to stick with Amazon for a while longer, even as I decrease my exposure to America and the American consumer. But as Amazon is unlikely to ever truly operate as a value company, issuing a dividend or similar, it is therefore unlikely to also remain part of my portfolio long-term.

Novo Nordisk stock crashes

On December 20th, Novo Nordisk (NOVO-B), experienced a massive stock crash of over 27% - which is very much out of the ordinary for this holding. Novo Nordisk is, of course, the innovative leading developer and distributor of weight loss and diabetics drugs with brand names like WeGovy and Ozempic. But trial results for its next-generation weight loss drug CagriSema, greatly disappointed the market, as it fell short of delivering an expected 25% weight loss in patients. In actuality, this seems more reflective of the company’s lack of ability to properly communicate, as the results pointed to patients dropping a still impressive 22.7% despite not being issued strict guidelines to follow.

The stock has taken quite a beating now, over the past year, following, of course, a meteoric rise, after the release of WeGovy and Ozympic, a few months after I sold my original position, which once made up 40%+ of my entire portfolio… Something I consider one of my greatest investment mistakes and to which I dedicated an entire in-depth guide on how to avoid.

I would consider increasing the size of my new position now, where it is not for having identified safer opportunities outside of the Western world, right now. Novo Nordisk may end up a major target for Trump, in his newest venture to threaten to annex Greenland, which is part of the Kingdom of Denmark, where the company is based.

Watch List

Changes to the Watch List

Removed Nubank after purchasing.

About

My Watch List sorts stock by sector and notes are included for each one, describing my interest and reservations. The status indicates the likelihood of a position being added to my portfolio. ‘Watching’ means I just keep an eye on them, whereas ‘Top Pick’ means they are very likely to find their way into my portfolio at one point - ‘Under consideration' means somewhere in between, with notes offering some elaborating thoughts. Please note my Watch List is based on my own research and goals and is in no way a recommendation of what to buy.

Disclaimer: I am not a financial advisor, the opinions expressed in this article are entirely my own – always invest at your own risk.