SoFi Technologies Inc. (SOFI: NSD) appears to have won the confidence of hedge fund investors in the wake of significant stock price fluctuations observed in 2024. The question that arises, then, is what factors are fueling such interest?
Stock Target Advisor’s Analysis on SoFi:
According to our analysis at Stock Target Advisor, SOFI currently holds a sell rating with a target price of USD 8.57. Over the next 12 months, we project a price change of 20.22%. However, it’s important to note that the average analyst target price for SoFi is higher at USD 8.81 with a hold rating.
From our perspective, we remain slightly bearish on SoFi, signaling three positive and six negative signs. Overall analyst coverage for SoFi comprises 13 analysts, who collectively have given SoFi a hold rating, with a mean analyst target price of 8.81. For context, the Credit Services sector rendered average 1-month and 1-week returns, with several large companies making their mark. Our rating for the Credit Services sector is Slightly Bearish.
SoFi Technologies: An Overview of Financial Analysis
The trailing 12-months returns for SoFi cast an interesting light on the company’s financial performance, with a 1-year capital gain of 20.44% (70.97% in Sector Percentile Ranking), and a total return of 20.44% (64.52% in Sector Percentile Ranking). The absence of a dividend yield is notable.
A deeper exploration of SoFi’s financials reveals a positive 5-year revenue growth of 661.35% but a disappointing -19.15% in 5-year earnings growth. Meanwhile, profitability ratios indicate potential concerns; -1.23% Return on Assets, -5.43% Return on Equity, and -2.7% Return on Invested Capital. With a Debt Equity Ratio of 85.6%, careful evaluation is vital for investors.
Bottom Line:
SoFi presents a mixed picture. While hedge funds are betting on its long-term potential, investors should carefully consider both the upside and downside risks before making any investment decisions.
