SoFi Technologies, Inc. (SOFI): A Bull Case Theory
We came across a bullish thesis on SoFi Technologies, Inc. (SOFI) on Value Degen's Substack. In this article, we will summarize the bulls' thesis on SOFI. SoFi Technologies, Inc. (SOFI)'s share was trading at $13.67 as of 2nd June. SOFI's trailing and forward P/E were 30.93 and 41.49 respectively according to Yahoo Finance.
An individual using a laptop to access the fintech platform to manage their finances.
SoFi (SOFI) is a fully digital neo-bank aiming to disrupt traditional banking through technology, with no physical branches and a broad suite of financial products. Its growth strategy centers on expanding its user base and increasing customer product adoption. SoFi has made significant progress, growing accounts from 8.7 million to 10.9 million in just two quarters, though annual growth has slowed to 34% from 52% as its base expands.
CEO Anthony Noto envisions reaching 50 million users in five years, but the focus is increasingly on deepening customer engagement. Product growth—now over 15 million—is a key but hard-to-verify metric, and while GAAP net income has been positive for six consecutive quarters, consistent growth in profitability remains elusive. The company expects stronger earnings beginning in 2025, with $320–$350 million in net income and a substantial increase to $650–$950 million projected in 2026.
Trading at ~45x 2025 earnings but only 15–30x 2026 estimates, SoFi appears expensive today but potentially cheap relative to forward growth. Revenue is expanding at 20–33% annually, and SoFi trades at just 3.77x sales, versus the 6–8x typical of high-growth, sticky-tech peers. If the multiple expands alongside revenue growth, shares could double by 2027. Risks include legacy banks finally innovating and concerns over SoFi's personal loan portfolio, though most loans are resold, and tangible book value continues to rise. With forward-looking profitability, strong growth, and a potential valuation rerating, SOFI presents a compelling entry point today ahead of its 2026 inflection.
Previously, we have covered SOFI in May 2025 wherein we summarized a on Substack. SoFi showed strong Q1 2025 growth with 33% revenue increase and improving profits, driven by expanding membership and financial services. Despite weak stock response, its solid fundamentals and conservative valuation pointed to potential stock price doubling by 2026.
SoFi Technologies, Inc. (SOFI) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 17 hedge fund portfolios held SOFI at the end of the first quarter which was 14 in the previous quarter. While we acknowledge the potential of SOFI as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. This article was originally published at Insider Monkey.
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