SoFi Stock Plummets: Unpacking the Underlying Issues
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy SOFI?
Source: Fool
- Significant Performance Growth: SoFi's Q1 adjusted net revenue surged 41% year-over-year to a record $1.1 billion, with EBITDA rising 62% to $340 million, showcasing strong performance in member growth and revenue despite a nearly 40% stock price drop.
- Sustained Membership Growth: SoFi added 1.1 million members in Q1, bringing the total to 14.7 million, a 35% year-over-year increase, marking the third consecutive quarter of 35% member growth, indicating success in customer acquisition.
- Loan Origination Innovation: Total loan originations hit a record $12.2 billion, with student loan volume doubling and home loan volume increasing nearly 2.4 times year-over-year, reflecting strong demand and market share growth in SoFi's lending operations.
- Valuation Issues Persist: Despite robust performance, management projects 2026 adjusted EPS of about $0.60, with shares near $16, resulting in a P/E ratio of approximately 27, highlighting valuation concerns amid economic uncertainty and rising personal loan default risks.
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Analyst Views on SOFI
Wall Street analysts forecast SOFI stock price to rise
14 Analyst Rating
5 Buy
6 Hold
3 Sell
Hold
Current: 15.310
Low
18.00
Averages
28.31
High
38.00
Current: 15.310
Low
18.00
Averages
28.31
High
38.00
About SOFI
SoFi Technologies, Inc. is a member-centric, one-stop shop for digital financial services. The Company, through its lending and financial services products, allows members to borrow, save, spend, invest and protect their money. The Company's segments include Lending, Technology Platform and Financial Services. The Lending segment offers personal loans, student loans, home loans and related servicing to help its members with a variety of financial needs. Its platform supports the full transaction lifecycle, including credit application, underwriting, approval, funding and servicing. The Technology Platform segment provides services through a diversified suite of offerings which include an event and authorization platform accessed via application programming interfaces, a cloud-native digital and core banking platform and services related to both platforms. The Financial Services segment offers a suite of financial services solutions, including SoFi Money and SoFi Invest.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
SoFi Stock Plummets: Unpacking the Underlying Issues
- Significant Performance Growth: SoFi's Q1 adjusted net revenue surged 41% year-over-year to a record $1.1 billion, with EBITDA rising 62% to $340 million, showcasing strong performance in member growth and revenue despite a nearly 40% stock price drop.
- Sustained Membership Growth: SoFi added 1.1 million members in Q1, bringing the total to 14.7 million, a 35% year-over-year increase, marking the third consecutive quarter of 35% member growth, indicating success in customer acquisition.
- Loan Origination Innovation: Total loan originations hit a record $12.2 billion, with student loan volume doubling and home loan volume increasing nearly 2.4 times year-over-year, reflecting strong demand and market share growth in SoFi's lending operations.
- Valuation Issues Persist: Despite robust performance, management projects 2026 adjusted EPS of about $0.60, with shares near $16, resulting in a P/E ratio of approximately 27, highlighting valuation concerns amid economic uncertainty and rising personal loan default risks.
See More
SoFi CEO's Stake Increase Fuels Stock Rebound
- CEO Stake Increase: SoFi CEO Anthony Noto purchased 15,545 shares on May 11 at an average price of approximately $16 per share, totaling around $248,780, which bolstered market confidence in the company's long-term growth prospects.
- Acquisition of PrimaryBid: SoFi is set to acquire most of the assets of UK retail investing platform PrimaryBid, although the exact purchase price remains undisclosed; this move will end the firm's independent operations while enabling a partial return of capital to investors, showcasing SoFi's strategic decision to expand its market share.
- Analyst Expectations: Despite multiple price target cuts from analysts recently, the 12-month average price target for SoFi stands at $21.10, indicating nearly 30% upside potential from its last close, reflecting a cautiously optimistic market outlook on its future performance.
- Improved Retail Sentiment: Following the CEO's stake increase and acquisition news, retail sentiment around SoFi shifted from 'bearish' to 'neutral', with message volumes increasing to normal levels over the past 24 hours, indicating renewed investor interest in the company's prospects.
See More
Fintech Stocks Shine: Analysis of Sezzle and SoFi
- Sezzle's Strong Performance: Sezzle's subscriber base grew by 48.4% year-over-year in Q1, driving a 29.2% revenue increase and achieving a net profit margin of 37.9%, showcasing its competitive edge and market share growth in the rapidly expanding BNPL sector.
- High Margin Model: Sezzle charges a 6.1% processing fee and $0.30 per transaction, and while high merchant fees may impact consumer spending, its interest-free installment payment option attracts more users, enhancing customer loyalty.
- SoFi's Stock Volatility: Despite SoFi achieving a 43% revenue growth and surpassing 14.7 million members in Q1, its stock fell over 15% due to not raising its guidance, reflecting market concerns about future expectations.
- Digital Banking Advantage: SoFi's digital banking model positions it to potentially exceed traditional banks in profit margins, particularly as its product categories show strong growth, with SoFi Money increasing by 34% year-over-year, indicating robust momentum in the fintech space.
See More
Fintech Investments Help Shareholders Outperform S&P 500
- Sezzle's Strong Performance: Sezzle reported a 48.4% year-over-year increase in its subscriber base in Q1, driving a 29.2% revenue growth and achieving a 37.9% net profit margin, demonstrating its ability to expand market share in a competitive fintech landscape.
- SoFi's Growth Potential: Despite SoFi's stock dropping over 15% due to unchanged guidance, the company achieved a 43% year-over-year revenue increase and reached 14.7 million members in Q1, indicating significant growth potential and the possibility of improved profit margins in the digital banking sector.
- Optimistic Industry Outlook: Mordor Intelligence projects a 15.3% compound annual growth rate for the fintech industry through 2030, suggesting substantial investment opportunities remain, particularly as some companies rapidly gain market share.
- Investor Focus: Although Sezzle was not included in The Motley Fool's list of top investment stocks, its robust performance and market appeal continue to attract investor interest, reflecting the investment frenzy and future growth potential within the fintech sector.
See More
Creative Ways to Invest in Anthropic Before IPO
- Diverse Investment Options: Investors can indirectly invest in Anthropic through funds like the KraneShares Artificial Intelligence and Technology ETF, ARK Venture Fund, and Destiny Tech100, which hold 2.6%, 3.0%, and a recent investment in Anthropic, respectively, providing diversified investment choices to mitigate risk.
- Strong Fund Performance: The KraneShares ETF has risen 17% in 2026, while Destiny Tech100 has shown even stronger performance with a 30% increase, indicating the investment potential and market appeal of these funds in the rapidly evolving AI sector.
- Management Fee Considerations: Although ARKVX has a high management fee of 2.75% and Destiny Tech100 charges 2.5%, investors must weigh these costs against potential returns to ensure the effectiveness of their investments in these high-growth areas.
- Market Volatility Risks: Given the high volatility in the AI industry, investors should be aware of the risks when selecting these funds; despite the high fees, diversified investments can help mitigate risks associated with individual companies.
See More
Anthropic Valuation Approaches $400 Billion Amid AI Growth
- Valuation Surge: Anthropic's valuation is nearing $400 billion, reflecting rapid growth in the generative AI sector, particularly in the development of large language models, which underscores its market potential and attractiveness.
- Investment Opportunities: Although Anthropic is not yet public, investors can still gain exposure through funds like the KraneShares Artificial Intelligence and Technology ETF, which allocates 2.6% to Anthropic, marking it as the 10th largest holding and highlighting its significance in the portfolio.
- Fee Structure: The management fee for the KraneShares ETF is 0.99%, while the ARKVX closed-end fund charges a hefty 2.75%, illustrating the cost differences among various investment vehicles, prompting investors to weigh fees against potential returns.
- Market Performance: In 2026, shares of the KraneShares ETF rose by 17%, while ARKVX shares increased by 9%, indicating sustained investor interest in AI companies amidst high volatility, despite the elevated fees.
See More
SoFi Stock Plummets: Unpacking the Underlying Issues
- Significant Performance Growth: SoFi's Q1 adjusted net revenue surged 41% year-over-year to a record $1.1 billion, with EBITDA rising 62% to $340 million, showcasing strong performance in member growth and revenue despite a nearly 40% stock price drop.
- Sustained Membership Growth: SoFi added 1.1 million members in Q1, bringing the total to 14.7 million, a 35% year-over-year increase, marking the third consecutive quarter of 35% member growth, indicating success in customer acquisition.
- Loan Origination Innovation: Total loan originations hit a record $12.2 billion, with student loan volume doubling and home loan volume increasing nearly 2.4 times year-over-year, reflecting strong demand and market share growth in SoFi's lending operations.
- Valuation Issues Persist: Despite robust performance, management projects 2026 adjusted EPS of about $0.60, with shares near $16, resulting in a P/E ratio of approximately 27, highlighting valuation concerns amid economic uncertainty and rising personal loan default risks.
See More
SoFi CEO's Stake Increase Fuels Stock Rebound
- CEO Stake Increase: SoFi CEO Anthony Noto purchased 15,545 shares on May 11 at an average price of approximately $16 per share, totaling around $248,780, which bolstered market confidence in the company's long-term growth prospects.
- Acquisition of PrimaryBid: SoFi is set to acquire most of the assets of UK retail investing platform PrimaryBid, although the exact purchase price remains undisclosed; this move will end the firm's independent operations while enabling a partial return of capital to investors, showcasing SoFi's strategic decision to expand its market share.
- Analyst Expectations: Despite multiple price target cuts from analysts recently, the 12-month average price target for SoFi stands at $21.10, indicating nearly 30% upside potential from its last close, reflecting a cautiously optimistic market outlook on its future performance.
- Improved Retail Sentiment: Following the CEO's stake increase and acquisition news, retail sentiment around SoFi shifted from 'bearish' to 'neutral', with message volumes increasing to normal levels over the past 24 hours, indicating renewed investor interest in the company's prospects.
See More
Fintech Stocks Shine: Analysis of Sezzle and SoFi
- Sezzle's Strong Performance: Sezzle's subscriber base grew by 48.4% year-over-year in Q1, driving a 29.2% revenue increase and achieving a net profit margin of 37.9%, showcasing its competitive edge and market share growth in the rapidly expanding BNPL sector.
- High Margin Model: Sezzle charges a 6.1% processing fee and $0.30 per transaction, and while high merchant fees may impact consumer spending, its interest-free installment payment option attracts more users, enhancing customer loyalty.
- SoFi's Stock Volatility: Despite SoFi achieving a 43% revenue growth and surpassing 14.7 million members in Q1, its stock fell over 15% due to not raising its guidance, reflecting market concerns about future expectations.
- Digital Banking Advantage: SoFi's digital banking model positions it to potentially exceed traditional banks in profit margins, particularly as its product categories show strong growth, with SoFi Money increasing by 34% year-over-year, indicating robust momentum in the fintech space.
See More
Fintech Investments Help Shareholders Outperform S&P 500
- Sezzle's Strong Performance: Sezzle reported a 48.4% year-over-year increase in its subscriber base in Q1, driving a 29.2% revenue growth and achieving a 37.9% net profit margin, demonstrating its ability to expand market share in a competitive fintech landscape.
- SoFi's Growth Potential: Despite SoFi's stock dropping over 15% due to unchanged guidance, the company achieved a 43% year-over-year revenue increase and reached 14.7 million members in Q1, indicating significant growth potential and the possibility of improved profit margins in the digital banking sector.
- Optimistic Industry Outlook: Mordor Intelligence projects a 15.3% compound annual growth rate for the fintech industry through 2030, suggesting substantial investment opportunities remain, particularly as some companies rapidly gain market share.
- Investor Focus: Although Sezzle was not included in The Motley Fool's list of top investment stocks, its robust performance and market appeal continue to attract investor interest, reflecting the investment frenzy and future growth potential within the fintech sector.
See More
Creative Ways to Invest in Anthropic Before IPO
- Diverse Investment Options: Investors can indirectly invest in Anthropic through funds like the KraneShares Artificial Intelligence and Technology ETF, ARK Venture Fund, and Destiny Tech100, which hold 2.6%, 3.0%, and a recent investment in Anthropic, respectively, providing diversified investment choices to mitigate risk.
- Strong Fund Performance: The KraneShares ETF has risen 17% in 2026, while Destiny Tech100 has shown even stronger performance with a 30% increase, indicating the investment potential and market appeal of these funds in the rapidly evolving AI sector.
- Management Fee Considerations: Although ARKVX has a high management fee of 2.75% and Destiny Tech100 charges 2.5%, investors must weigh these costs against potential returns to ensure the effectiveness of their investments in these high-growth areas.
- Market Volatility Risks: Given the high volatility in the AI industry, investors should be aware of the risks when selecting these funds; despite the high fees, diversified investments can help mitigate risks associated with individual companies.
See More
Anthropic Valuation Approaches $400 Billion Amid AI Growth
- Valuation Surge: Anthropic's valuation is nearing $400 billion, reflecting rapid growth in the generative AI sector, particularly in the development of large language models, which underscores its market potential and attractiveness.
- Investment Opportunities: Although Anthropic is not yet public, investors can still gain exposure through funds like the KraneShares Artificial Intelligence and Technology ETF, which allocates 2.6% to Anthropic, marking it as the 10th largest holding and highlighting its significance in the portfolio.
- Fee Structure: The management fee for the KraneShares ETF is 0.99%, while the ARKVX closed-end fund charges a hefty 2.75%, illustrating the cost differences among various investment vehicles, prompting investors to weigh fees against potential returns.
- Market Performance: In 2026, shares of the KraneShares ETF rose by 17%, while ARKVX shares increased by 9%, indicating sustained investor interest in AI companies amidst high volatility, despite the elevated fees.
See More
