SOFI Stock: Why It Significantly Increased This Week

By Amit Chowdhry ● Sep 23, 2021
  • The stock price of SoFi Technologies Inc (NASDAQ: SOFI) is trading at over 10% over the past week. This is why it happened.

The stock price of SoFi Technologies Inc (NASDAQ: SOFI) is trading at over 10% over the past week. Investors are responding positively to a bullish research report.

Jefferies analyst John Hecht initiated coverage of the company shares with a “Buy” rating and a $25 price target. Hecht believes that SoFi’s flywheel is able to continue to drive significant user growth, product adoption, and margin expansion going forward. And a Jefferies survey showed that neobanks and fintech companies are rapidly accumulating market share. But there are some barriers to overcome.

The member growth is key for SoFi’s strategy as a direct driver of revenue expansion. And Hecht is projecting 46% average revenue growth through 2025. Plus Hecht noted that SoFi made significant progress as it seeks a Federal bank charter. The impacts of the charter is not factored into the long-term guidance or estimates. But Hecht wrote that the addition of a bank charter would add around 30% in incremental adjusted EBITDA relative to the current base case estimates.

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.