The bull market may be in full swing, but SoFi Technologies (NASDAQ:SOFI) seems to have missed the memo. Shares of the neo bank are down by 26% year-to-date, leaving investors out of the tech-driven rally’s gains.
According to Deutsche Bank’s Mark DeVries, an analyst ranked in the top 2% of Wall Street stock experts, the recent downturn can be attributed to “growing skepticism over management’s long-term EPS guidance ($0.55-$0.80 for 2026)…”
With the company set to report its Q2 results on July 30, DeVries’ focus will turn to loan growth and “incremental Galileo” wins. And here, the analyst thinks there’s a way to restore investors’ trust.
“If the company can point to some incremental momentum on monetizing their existing customer relationships or notable account wins on their Galileo platform that could bolster confidence in their ability to get back to 20% + revenue growth, then the shares could be in for a significant re-rating higher,” the 5-star analyst explained.
Management has highlighted several “encouraging signs” that suggest they are on track to boost revenue growth again. However, considering the recent trends in revenue and credit, it appears the market may be seeking more concrete signs of growth improvement than what is likely to be on offer in the Q2 readout.
As for the numbers, DeVries is looking for Q2 adj. revenue of $566.131 million, amounting to a 15.8% year-over-year increase, slightly above the high end of SOFI’s guide for $555 – $565 million. The analyst sees 2Q24 adjusted EBITDA climbing by 58% compared to the same period a year ago, thereby reaching $121.544 million, a little above the midpoint of the guide ($115 – $125 million).
Bottom line, DeVries maintained a Hold (i.e., Neutral) rating on SOFI shares to go alongside a price target of $11. To be fair, DeVries might just as well have said Buy as that figure suggests shares will gain ~58% over the next 12 months. (To watch DeVries’ track record, click here)
Looking at the consensus breakdown, the fencesitters make up the majority of current SOFI reviews; the stock’s Hold consensus rating is based on a total of 9 Hold recommendations, 4 Buys and 3 Sells. That said, at $8.15, the average price target factors in one-year returns of ~11%. (See SOFI stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
