SoFi’s Stock Delivers Strong Start To 2025, Be Prepared For Some Whipsaw

SoFi Technologies' stock (NASDAQ: SOFI) has already taken holders on a mini rollercoaster through the first month of 2025, with a rally of more than 25% through the first few trading weeks of the year giving way to a ~12% dip that has been bought. The mini correction, or breather, has shown the stock to have support ~$15.50, potentially firming up the next leg. Can more be expected of SoFi, having already doubled in the past year?

Earnings came in strong this week, yet the analyst community has not been overly eager to shift tact off the back of the quarter. A beat on EPS, with $0.05 against the consensus of $0.04 came as revenue grew to $739.11 million in the period. This was both above the consensus of $682 million, and continued momentum from the previously reported $689.44 million.

A critical driver of SoFi's performance has been its substantial rise in non-lending financial services sales, which increased by 102%. These services now contribute 49% to the overall revenue, up from 39% in the previous year. Additionally, SoFi's lending contribution profit rose to $239 million, marking a 17% increase year over year. The company also reported that financial services contribution profit grew dramatically from $3 million to $100 million compared to last year.

The strategic acquisitions of Golden Pacific Bancorp and Galileo have fortified SoFi's business structure. These moves have provided SoFi with a bank charter and enhanced its tech platform, respectively, enabling the firm to broaden its financial service offerings.

A substantial increase in customer acquisition also points to SoFi's growing popularity, with the addition of 756,000 new members and 1.1 million new products in just the third quarter. This growth aligns with management's optimistic outlook, forecasting a 20% to 25% sales growth through 2026.

Analysts' current consensus remains considerably below current price action, with the $13.29 lagging. The high mark of $20 and the low of $5 demonstrates the huge gulf in opinion when it comes to SoFi, and shifting either side of the line may prove tricky.

SoFi is on a solid path with diversified financial offerings, strategic acquisitions, and consistent revenue growth. Whether the momentum can be maintained in periods to come in order to earn the current PE multiple is yet to be seen, but for the time being, the bulls are in charge, with a year-to-date rise of 16% a significant outperformance on broader markets.