In the near horizon is the unveiling of SoFi’s (SOFI: NSD) 4Q23 results and guidance for Q1 and beyond. Well-regarded J.P. Morgan analyst Reginald Smith recently revised his models, expressing a freehand of caution on SoFi’s future performance. An indication of a slowdown in loan growth by SoFi’s management has triggered a bit of unease among analysts.
J.P. Morgan’s Caution: Should Investors be Worried?
Foremost, Smith forecasts a slower trajectory for SoFi’s loan growth, an increase in credit losses, and a contraction in gain-on-sale margins. Anticipating a potential slowdown in ’24 guidance and deteriorating credit trends, Smith assigns a Neutral rating with a price target of $10, implying a 31% potential growth. Despite maintaining a Neutral rating on SoFi, Smith has set a price target of $10, which represents a potential growth of 31% over the next year.
Stock Target Advisor’s Analysis on SOFI:
Stock Target Advisor, in response, rates SoFi as Sell with a target price of 10.22. The projection demonstrates a 34.15% price change in the next 12 months. The average analyst target price for SoFi settles at USD 9.76, with a consensus rating of Hold.
A total of 12 analysts covers the stock, with an average target price of 9.76 and a maximum and minimum average target price of 16 and 3 respectfully. Within the Credit Services, NSD sector, the average analyst rating hovers at ‘Buy.’ Stock Target Advisor’s Rating lies at ‘Slightly Bearish’ with an average 1-month return of 0.01% and 1-week return of 0.22%.
After reviewing the financial and market analysis and the range of analyst ratings, it becomes clear that investors should closely monitor SoFi’s forthcoming earnings reports and management guidance. The coming months will be key in understanding the movement of SoFi’s stock and whether the cautious outlook from J.P. Morgan is warranted.