Two Stocks Worth a Goblin’s Hoard

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Now, listen closely. A mere thousand coins—a sum that wouldn’t buy you a decent dragon’s tooth these days—can, with a little foresight, become the seed of a rather respectable fortune. Not overnight, mind you. We’re not talking about turning lead into gold, more like…carefully tending a particularly promising mushroom. Some growth stocks, you see, double in value within a few years, others manage it in months. It’s a matter of finding the right fungi, and avoiding the ones that glow faintly and smell of regret.

A sensible investor—one who doesn’t rely on divination or the pronouncements of talking parrots—looks at a company’s foundations. Rising revenue and healthy profit margins are generally good signs. It suggests, if nothing else, that people are actually buying whatever it is they’re selling. We’ll examine two such companies, both operating in the increasingly peculiar world of ‘fintech’—a term that sounds suspiciously like a magical incantation.

Robinhood: A Modern-Day Pied Piper (With Algorithms)

Robinhood (HOOD 0.30%) has amassed over 27 million funded customers on its online trading platform. A considerable number, even if one accounts for the fact that many of them are probably trading based on tips from questionable sources. The company hasn’t peaked, not by a long shot. Its customer base increased by 7% year over year in 2025—a respectable growth rate, though not quite as impressive as the proliferation of garden gnomes in Lower Puddleton. Average revenue per user surged by 16% year over year. It’s a good mix, attracting more customers while simultaneously convincing them to part with more of their coins.1

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Robinhood, as you might expect, flourishes when the financial markets are performing well. People like to trade stocks, options, and other…assets. Revenue increased by 27% year over year, with stocks and options revenue leading the charge. Crypto revenue dipped by 38% year over year due to Bitcoin (BTC 1.74%)’s recent slump—a cautionary tale about putting all your eggs in a digital basket.2 However, crypto revenue more than quadrupled in the third quarter, demonstrating a remarkable capacity for recovery—once Bitcoin regains its…momentum. It’s like a particularly stubborn mule; it will eventually move, but you need a very long rope.

The company also posted higher net income year over year, if one conveniently ignores the one-time $424 million benefit from a fourth-quarter 2024 tax adjustment and accrual reversal. A bit like finding a lost purse in the street; it boosts your income, but doesn’t necessarily reflect underlying financial health. More interestingly, Robinhood is venturing into prediction markets—a realm where one can wager on the outcome of future events. In Q4, this segment processed 8.5 billion event contract trades, and January saw 3.4 billion more—suggesting that people are increasingly willing to bet on…well, everything.3

Robinhood has more than doubled in value over the past five years, but is currently down by over 30% year to date. This presents an attractive opportunity to acquire shares at a discounted price—assuming, of course, that you believe in the long-term prospects of a company that encourages impulsive trading. A bit like selling potions to adventurers; potentially lucrative, but ethically questionable.

Nu Holdings: The Bank Without Walls (Or, Why Branches Are for Birds)

Nu Holdings (NU +2.08%) is the largest bank in Latin America—and it doesn’t have a single physical branch. A remarkable feat of financial engineering, or simply a recognition that brick and mortar are largely unnecessary in the age of digital transactions. This translates into lower costs, higher margins, and more competitive products. The company serves over 60% of the adult population in its home market of Brazil, and is gaining traction in Mexico, Colombia, and throughout Latin America. It’s a bit like a rapidly spreading vine; impressive, but potentially invasive.

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The fast-growing region helped Nu Holdings deliver 39% year-over-year revenue growth in Q3 2025. The online bank added 4 million new customers, closing the quarter with over 127 million. The bank also boasts an 83% activity rate, meaning most of these customers are actually investing, saving, and borrowing through Nu Holdings. A surprisingly high number, considering how easily distracted people are these days.

Multiple Nu Holdings products are growing at exceptional rates. Customer balances in credit cards and loans rose 45% year over year, while interest-earning portfolios were up 58%. A healthy sign, suggesting that people are not only borrowing money, but also earning interest on their savings. A virtuous cycle, if you will.

All this growth translated into rising profits. Net income surged by 41% from 2024, securing a 41% net profit margin. A high-growth product line with rising margins in a hot region suggests that Nu Holdings can continue to gain momentum. It’s like a well-oiled clock; precise, efficient, and potentially unstoppable.


1 It’s been said that a fool and his money are soon parted. Robinhood seems to cater to both.
2 Bitcoin, a digital currency based on cryptography and fueled by speculation. A modern-day alchemy, if you will.
3 Predicting the future is a tricky business. Even the most skilled soothsayers get it wrong occasionally.

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2026-02-19 12:53