SoFi Technologies (SOFI) recently received a Hold rating from a Top-rated analyst, Reginald Smith from J.P. Morgan (JPM). His price target of $9 indicates a potential upside of 22.8%. Importantly, the Neutral rating came just before SOFI’s second-quarter results, which are scheduled for release before the market opens today.
Smith raised concerns about SoFi’s performance, pointing out that the company has lowered its revenue guidance for two consecutive quarters. It is worth mentioning that after reporting sales of $594 million in Q4 2023, SoFi predicted a 5.7% to 7.4% sequential decline in revenue for the next quarter. Similarly, in Q1 2024, it posted sales of $580.6 million but forecasted a sequential fall of 2.7% to 4.4% in Q2.
Despite a recent rally in the stock price, Smith remains cautious, pointing out that any potential gains are contingent on improvements in the credit quality of SoFi’s personal loan portfolio. The report also highlights that SoFi’s stock has been underperforming compared to the S&P 500 Index (SPX).
SOFI: Q2 Expectations
Wall Street analysts expect a 16.5% year-over-year decline in revenue to $565.19 million.
Conversely, analysts project that SOFI’s bottom-line performance will be noteworthy, with expected earnings per share of $0.01 compared to a loss of $0.06 in the year-ago quarter.
Is SoFi Stock Expected to Go Up?
Analysts remain sidelined about SOFI stock, with a Hold consensus rating based on four Buys, nine Holds, and three Sells. The analysts’ average price target on SoFi of $8.15 implies an upside potential of 11.19% from current levels.
These analyst ratings might change following the announcement of SOFI’s results today.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
