I just finished writing the Weekly Buzz, where I deep dive into SoFi Technologies ($SOFI), and the research made me more bullish on the stock (which to be honest I didn't really know much about before) For those unfamiliar, SoFi is a Fintech super app that makes its money through 3 main channels: 1) 💰 Lending (50% of revenue): Core lending offerings across personal, student, and home loans 2) 📈 Financial Services (37% of revenue): SoFi Money (banking, high interest accounts, etc), SoFi Invest (commission-free trading), Credit Cards, etc. 3) 🏦 Technology Platform (13% of revenue): Software and APIs offered to banks and fintechs It jumped 14% this week due to its foray into private markets (so you can now buy funds on the app with exposure to OpenAi and SpaceX), but what I found most interesting was their return to crypto 🪙 When they got their banking charter in 2023, SoFi had to wind down it's crypto services. But with Trump easing regulations, they have annouced plans to launch crypto investing by the end of the year. For Robinhood ($HOOD), crypto has been big business, accounting for half of the company's revenue growth in the past year and 27% of total revenues, so I think this could be a big opportunity for SoFi if they execute it well. 📊 Of course, the valuation is quite rich, at a 72x forward PE. But this is in line with Robinhood (70x) and Coinbase (71x). 🤔 Curious what folks on Blossom think about the stock and whether it's overvalued, or still has lots of room to grow... 🐝 Will link the full write-up in the Weekly Buzz in the comments!
Thank you for creating this awesome app Maxwell! Your team is awesome!👏 🫡 And Sofi is a longterm hold for me, and it's one of my largest, high conviction plays.
Bradley @bradleytalksmoney · 1yr
Shares are at near all time highs, what price discovery or multiple expansion is left with this company. Without those two things then they just have earnings growth to put upward pressure on the stock, and if that doesn't meet the 25% growth the market is already pricing in then there is more downside risk than upside potential here. What's the margin of safety at this price, regardless of if it's a great company?
Scott S@scottsinvesting · 1yr
Enjoy your Weekly Buzz emails Max. Thank you! Full disclosure... I'm a $SOFI shareholder with a ~$9 usd cost basis and hope to hold a position for years to come, but also ready to sell if/when my investment thesis degrades. With that said, it's currently trading a 40-50% above my current intrinsic value. I'm not trimming just yet but might soon... FWIW... Trading inline with $COIN & $HOOD valuations doesn't change my opinion about SOFI's overvaluation. IF I HAD to buy one of the 3 right now, it would be SOFI (superior mgmt IMO), but I'd be holding my nose doing it at an unjust 70x forward earnings. Glad that's not the case...
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