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Jul 21, 2021
[6 min Read]
I have read so many DD's on this sub regarding SOFI. Many of those DD's were just people trying to pump their position in order get some tendies. I will make sure to only summarize and include some parts of those DD's that were not meant for pump & dump. This is a NON BIASED SOFI DD & Analysis. Let's get started -
What is SOFI?
Social Finance, Inc aka SoFi is an American online personal finance company. A mobile-first service based in San Francisco, SoFi provides a suite of financial products that includes student loan refinancing, checking accounts, mortgages, personal loans, credit cards, stock investing and banking through both their mobile app and desktop interfaces. It is an ALL in one app for all your financial and investing needs.
Look at the products sofi has to offer. The company has an amazing easy to use user interface and very smooth app.
The one single factor that gains Sofi a lot of revenue and sales is "Convenience". Because they provide a lot of services, they are able to attract their customers to get different products.
Let's say you decide to buy a car and go to Sofi for a car loan. The Sofi team asks you to provide your Social security, pay stubs, previous bills, etc. and then finally grants you a car loan. Now, let's say after 3 months your friend who has been making a bank trading AMC and GME tells you to invest and you don't have a brokerage account. You eventually would end up knocking SOFI's door and ask them to let you invest because why the fuck would you want to fill out forms and apply at other brokerages. Now, let's say after couple of months of trading, you end up losing all your money because you're an APE who yolo'ed entire savings into 1st ever options play. Now, you need money for that business degree because you suck at investing. What would you do here? Would you go to some student loan company and fill out all the forms, provide credit history, etc. or would you just call up SOFI and ask them to loan you some tendies? The simple answer is "Call up SOFI" because it's convenient.
You can now invest in IPO's even before they're traded on an exchange. Cool, innit?Unlike Robinhood, SOFI would never restrict the sale of the securities to the members in secondary markets. However, if you invest in an IPO and sell within 30 days then you might be restricted from IPO purchase for next 30 days or so. More details can be found on their website -
SoFi was founded in 2011 by Mike Cagney, Dan Macklin, James Finnigan, and Ian Brady, four students who met at the Stanford. The founders hoped SoFi could provide more affordable options for those taking on debt to fund their education. The company's inaugural loan program was a $2 million pilot at Stanford. For this pilot, 40 alumni invested about $2 million in approximately 100 students, for an average of $20,000 per student.
The founders were soon able to raise $1billion from softbank few years ago. The company is very successful and trading way below their valuation price.
This is 1 year chart for Sofi, it has a very very strong support at 15$. The stock has gone below 15$ only twice in 2021 and then rallied the following 2 weeks. The movement of this stock is like a spring, a huge dip is followed by an insane highs. The earnings are due 8/12 and I strongly believe that this stock will run before the earnings.
Michael Miller, an equity analyst at morning star said that $20.50 is a Fair Value for this stock. It's currently trading at $15.10 at the time of writing this DD. That's an upside of 25%.
Summary of why is SOFI a good play?
Not a Finance Advice
The stock could rally prior to earnings on 8/12
$18-$20 calls expiring 8/20
50 contracts, strike 20$ expiring 8/20