TLDR
- SoFi Technologies (SOFI) hit an all-time high of $28.58 on September 18, 2024, marking a 247% gain over the past 52 weeks
- The company reported strong Q2 results with 43% revenue growth to $855 million and added a record 850,000 new members
- SoFi launched the Agentic AI ETF (AGIQ) on September 3 and partnered with Lightspark for blockchain money transfers
- Wall Street analysts maintain mixed views with a “Hold” consensus rating and $19.89 average price target
- The stock trades at 86 times forward earnings, raising valuation concerns despite strong growth metrics
SoFi Technologies stock reached an all-time high of $28.58 on September 18. The fintech company has gained 247% over the past 52 weeks and sits 83% higher year-to-date.
The stock first began trading on Nasdaq in June 2021 following a SPAC merger. SoFi now carries a market capitalization of $32.5 billion.
Rising optimism about potential Federal Reserve rate cuts has helped fuel the rally. Lower interest rates typically benefit financial companies by reducing funding costs and increasing loan demand.
The company recently launched the SoFi Agentic AI ETF (AGIQ) on September 3. The fund tracks companies generating at least 30% of revenue from AI and autonomous decision-making technologies.
SoFi also announced a partnership with Lightspark to offer blockchain-enabled international money transfers. The service will use the Bitcoin Lightning Network to provide faster and cheaper remittance options.
Strong Second Quarter Performance Drives Growth
SoFi reported solid second-quarter results on July 29 that beat analyst expectations. Total net revenue jumped 43% year-over-year to $854.94 million.
The company added a record 850,000 new members in Q2. This represents a 34% increase from the prior year, bringing total membership to 11.7 million.
SoFi introduced 1.26 million new products during the quarter. This 34% increase brought the total product count to 17.1 million across the platform.
Fee-based revenue hit a record $377.50 million, up 72% from the previous year. Strong performance from the Loan Platform Business drove much of this growth.
Earnings per share reached $0.08, a 700% increase from $0.01 in the prior year. The result also beat Wall Street’s $0.06 expectation.
Based on these results, SoFi raised its full-year guidance. The company now expects adjusted net revenue of approximately $3.375 billion.
This updated forecast represents roughly 30% annual growth. The previous guidance range called for 24% to 27% growth.
Mixed Analyst Views Despite Recent Upgrades
Wall Street analysts maintain a cautious stance on SoFi stock. The consensus rating sits at “Hold” across 24 analyst ratings.
Five analysts rate the stock a “Strong Buy” while two suggest a “Moderate Buy.” Twelve analysts maintain “Hold” ratings.
Two analysts give “Moderate Sell” ratings and three maintain “Strong Sell” ratings. The consensus price target of $19.89 implies 30% downside from current levels.
Needham recently reiterated its “Buy” rating while raising the price target from $25 to $29. The firm cited improving funding conditions for digital lending businesses.
JPMorgan maintained a “Neutral” rating but increased its price target to $24. Analyst Reginald Smith noted concerns about balance sheet growth but remained optimistic about prospects.
Keefe Bruyette raised its price target from $13 to $14. However, the firm maintains an “Underperform” rating on the stock.
The stock currently trades at 86 times forward earnings. This valuation appears stretched compared to industry averages.
Analysts expect earnings per share to climb 60% year-over-year to $0.08 for the current quarter. Full-year EPS projections call for 113% growth to $0.32.
CEO Anthony Noto recently entered into a prepaid variable forward contract involving 1.5 million shares. The contract provided Noto with an upfront payment of $24.1 million and matures in approximately three years.
