TLDR:
- SoFi stock jumped 20% on Wednesday following President Trump’s 90-day tariff pause
- Despite strong Q4 2024 earnings, SOFI is down roughly 25% in 2025 due to softer Q1 guidance
- Investor “KM Capital” believes the stock is “massively undervalued” with strong upside potential
- SoFi is expected to post 23-26% revenue growth for FY2025 and 67% EPS growth
- Wall Street remains divided with a consensus “Hold” rating and $13.75 price target (20% upside)
SoFi Technologies stock received a much-needed boost on Wednesday, jumping nearly 20% after President Trump announced a 90-day pause on tariffs. The move helped breathe new life into the financial technology company’s shares after weeks of downward pressure amid recession fears.
The stock had been struggling in 2025. Despite delivering record revenues in Q4 2024, SoFi is down approximately 25% year-to-date, largely due to softer guidance for Q1 2025 that disappointed investors.
One investor known by the pseudonym KM Capital remains bullish on SoFi’s prospects. “While the near-term environment is uncertain, the stock is massively undervalued with significant upside potential,” the investor stated.
KM Capital disputes the market’s pessimism regarding SoFi’s 2025 outlook. The investor points out that management is still projecting strong growth in the coming months, making the recent sell-off seem excessive.
Growth Projections Remain Strong
SoFi’s projected 23-26% revenue growth for fiscal year 2025 remains impressive, even when compared to the 35% growth achieved in 2024. KM Capital notes that as the company grows larger, some slowing in percentage growth rates is natural and expected.
The company appears to be successfully increasing its profit margins. SoFi’s expected earnings per share growth of 67% would substantially outpace its revenue growth, indicating improved profitability.
Another bright spot is SoFi’s ability to cross-sell various financial products across its expanding membership base. This strategy has helped drive both revenue growth and improved margins.
Over the past month, SoFi shares have returned -15.6%, compared to the S&P 500’s -13.5% decline during the same period. The financial services industry as a whole has lost 17.6% during this timeframe.
Analysts have been adjusting their earnings projections for SoFi. The consensus earnings estimate of $0.25 per share for the current fiscal year indicates a year-over-year improvement of 66.7%. This estimate has been revised downward by 3.2% over the last 30 days.
Recent Performance and Outlook
For the next fiscal year, analysts expect earnings of $0.50 per share, representing a potential 97.4% increase from the current year’s projections. This estimate has been trimmed by 5.7% over the past month.
SoFi reported $739.11 million in revenue for its last quarter, a 24.4% year-over-year increase. Earnings per share came in at $0.05, compared to $0.02 in the same period a year ago.
The company has a strong track record of exceeding analyst expectations. Over the last four quarters, SoFi surpassed consensus EPS estimates three times and beat revenue forecasts in all four quarters.
Potential investors should be aware of the risks. KM Capital acknowledges that SoFi could face setbacks, especially if a recession materializes. The investor also notes that SOFI has historically been a volatile stock and could experience sharp drops if market panic occurs.
Wall Street Remains Divided
Wall Street opinion on SoFi is mixed. The stock currently holds a consensus “Hold” rating, with 6 Buy, 6 Hold, and 4 Sell ratings from analysts. The average 12-month price target stands at $13.75, suggesting potential upside of just over 20% from current levels.
According to the Zacks investment research firm, SoFi Technologies is rated as a “Zacks Rank #3 (Hold),” suggesting it may perform in line with the broader market in the near term.
For the current quarter, SoFi is expected to post earnings of $0.03 per share, representing a year-over-year increase of 50%. The consensus sales estimate for the quarter is $743.74 million, indicating a year-over-year growth of 28.1%.
For the full fiscal years 2025 and 2026, revenue estimates stand at $3.23 billion and $3.89 billion respectively, representing growth of 23.9% and 20.6%.
SoFi’s most recent quarterly report showed the company outperforming expectations, with reported revenues of $739.11 million beating the consensus estimate by 8.8%. Earnings per share came in at $0.05, exceeding forecasts by 25%.
“As a long-term investor, I am confident that SoFi will be able to deliver superior returns over the long term,” concluded KM Capital, who rates the stock a Strong Buy.
