SoFi Technologies, Inc. (SOFI) Laps the Stock Market: Here’s Why

The latest trading session saw SoFi Technologies, Inc. (SOFI) ending at $15.63, denoting a +1.82% adjustment from its last day’s close. The stock’s change was more than the S&P 500’s daily gain of 0.73%. Elsewhere, the Dow saw an upswing of 0.16%, while the tech-heavy Nasdaq appreciated by 0.98%.

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Heading into today, shares of the company had lost 1.6% over the past month, outpacing the Finance sector’s loss of 2.93% and lagging the S&P 500’s gain of 0.34% in that time.

The investment community will be paying close attention to the earnings performance of SoFi Technologies, Inc. in its upcoming release. The company is predicted to post an EPS of $0.04, indicating a 100% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $663.04 million, showing a 11.58% escalation compared to the year-ago quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $0.12 per share and revenue of $2.52 billion, indicating changes of +133.33% and +21.43%, respectively, compared to the previous year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for SoFi Technologies, Inc. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

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Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we’ve formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. SoFi Technologies, Inc. is currently sporting a Zacks Rank of #2 (Buy).

Investors should also note SoFi Technologies, Inc.’s current valuation metrics, including its Forward P/E ratio of 129.63. This expresses a premium compared to the average Forward P/E of 12.19 of its industry.

It’s also important to note that SOFI currently trades at a PEG ratio of 2.55. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company’s projected earnings growth. As the market closed yesterday, the Financial – Miscellaneous Services industry was having an average PEG ratio of 1.03.

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