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Everyone know the market has been beaten down, and that trend may continue for the unforeseeable future. But most of the bearish activity we saw last week was a result of the $3.3 trillion in options that expired yesterday. Market manipulation at its best. MMs/HFs win. You lose.
In this takedown, many bad players have been spanked. And many value stocks as well. The damage has been indiscriminate.
SOFI represents a value proposition that should be trading at a much higher share price for the following reasons:
Analyst price targets look as follows:
This video does a great job explain how obtaining the bank charter will help SOFI:
https://www.youtube.com/watch?v=49xrLU_wQMY
This is what Barron's had to say about SOFI:
SoFi Technologies SOFI-NasdaqOutperform Price $12.25 on Jan. 19 by Wedbush
We're initiating coverage of SoFi with an Outperform rating and a $20 price target. Our rating is based on the company's strong growth outlook, with a five-year revenue compound annual growth rate of 28% through 2026. An increasing brand presence should drive member growth; its integrated technology platform, Galileo, is a competitive advantage that allows for a seamless cross-buying experience aimed at a digitally native younger cohort; it has strong unit economics across its products; we expect credit quality to be stronger than peers, given that its borrowers are at the higher end of the credit spectrum, with an average FICO of 750; and the company's pending bank charter [approved on Jan. 18] should accelerate earnings growth, in our view. The company is a one-stop shop for financial services, and this is a significant competitive advantage over neobank competitors that tend to focus on niche offerings rather than the full financial picture.
Analyst recommendations are as follows:
If you look at the cyclic nature of how SOFI trades, you can see that it is due to another major move up. As can be seen by the chart, SOFI is very oversold, and at a time where the company has never looked stronger.
Bears will continue to dump negative on SOFI, but they can't beat the fundamentals. They can't back up their FUD with numbers. So they will then try to sell you on the ever impending market crash. If there was going to be a market crash soon, we would see evidence of that in the debt market. That evidence does not exist. Expect any market correction to be gradual and drawn out over time as the Fed eases inflation.
TLDR: SOFI represents a value proposition and tremendous great growth potential. When fundamentals start to matter again, SOFI is already prepared to meet those expectations.
Disclaimer: This is not financial advice. I'm a small investor that is just sharing my opinion on SOFI. I am currently holding a small number of calls on SOFI expiring 01/28 at $15.00 and $17.50. I plan on buying more calls on Monday if we see any further price decline.
Edit: Added YouTube video link.