S&P 500 slips, but losses kept in check as Nvidia climbs ahead of results
Tuesday, SoFi Technologies Inc. (NASDAQ:SOFI) shares rose after the company reported first-quarter earnings that surpassed expectations and increased its financial guidance. The fintech company, currently valued at $14.7 billion, has demonstrated strong momentum with a 17% gain in the past week alone. Despite the positive news, BofA Securities analyst Mihir Bhatia maintained an Underperform rating with a $13.00 price target on the stock. According to InvestingPro analysis, SoFi appears to be trading above its Fair Value.
SoFi Technologies’ shares had been lagging behind the S&P 500 by 8 percentage points prior to the release of its first-quarter results. Investors had expressed concerns over the potential effects of macroeconomic uncertainty and the possibility of wider credit spreads. However, the quarter turned out robust, with adjusted revenues and EBITDA exceeding the upper end of the company’s forecasts, and earnings per share (EPS) beating estimates due to higher revenue and a lower tax rate.
The company’s guidance for the future was raised, primarily reflecting the strong performance in the first quarter. Bhatia noted the company’s continued business momentum, highlighted by a record addition of 800,000 new members during the quarter, while the number of products per member remained stable.
Despite the strong quarter and the upward revision of guidance, Bhatia expressed caution. The current stock price, according to the analyst, reflects a level of perfection that may be challenging to maintain given the uncertain macroeconomic environment. As a result, the Underperform rating was reiterated.
In other recent news, SoFi Technologies reported impressive financial results for the first quarter of 2025, exceeding market expectations. The company achieved an earnings per share (EPS) of $0.06, surpassing the forecast of $0.04, while its revenue reached $771.76 million, beating the projected $740.33 million. SoFi also raised its full-year guidance, expecting adjusted net revenue between $3.235 billion and $3.310 billion, indicating a 24-27% year-over-year growth. The company continues to experience significant growth in its membership base, adding 800,000 new members and launching 1.2 million new products in the quarter. SoFi’s adjusted EBITDA rose 46% year-over-year to $210 million, showcasing strong profitability. The firm’s financial services and technology platform segments contributed significantly to revenue growth, with fee-based revenue increasing by 67% year-over-year. SoFi also announced plans to expand its product offerings, including potential ventures into crypto and blockchain. These developments highlight SoFi’s ongoing commitment to innovation and growth within the financial technology sector.
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