SoFi Stock May Have Peaked

• SoFi (SOFI) shows strong technical momentum, with a 68% gain since April.
• Shares are trading above key moving averages, signaling continued bullishness.
• Revenue and earnings are projected to grow significantly over the next two years, supporting the stock’s recent price appreciation.
• Analyst sentiment is mixed, with some calling SOFI overvalued and others rating it a “Buy,” reflecting uncertainty about further upside.

Today’s Featured Stock

Valued at $23.8 billion, SoFi Technologies (SOFI) provides a consumer-focused financial technology platform. 

What I’m Watching

I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals; superior current momentum in both strength and direction; and a Trend Seeker “buy” signal. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation.  SOFI checks those boxes. Since the Trend Seeker signaled a buy on April 28, the stock has gained 63.18%. 

More Top Stocks Daily: Go behind Wall Street’s hottest headlines with Barchart’s Active Investor newsletter.

 

SOFI Price vs. Daily Moving Averages:

www.barchart.com

Barchart Technical Indicators for SoFi Technologies

Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.

SoFi Technologies shares hit a new 52-week high on July 29, touching $25.11 in intraday trading.

• SoFi Technologies has a Weighted Alpha of +209.12.
• SOFI has an 88% “Buy” opinion from Barchart.
• The stock has gained 232.5% over the past year.
• SOFI has its Trend Seeker “Buy” signal intact.
• SoFi Technologies is trading above its 20-, 50-, and 100-day moving averages.
• The stock made 7 new highs and gained 15.13% in the last month.
• Relative Strength Index (RSI) is at 57.77%.
• There’s a technical support level around $21.20.

Don’t Forget the Fundamentals

• $23.8 billion market capitalization.
• 90.88x trailing price-earnings ratio.
• Revenue is projected to grow 31.05% this year and another 22.38% next year.
• Earnings are estimated to increase 110.84% this year and an additional 65.69% next year.

Analyst and Investor Sentiment on SoFi Technologies

I don’t buy stocks because everyone else is buying, but I do realize that if major firms and investors are dumping a stock, it’s hard to make money swimming against the tide.

It looks like Wall Street analysts are split on SOFI, and so are most major advisory sites.

• The Wall Street analysts tracked by Barchart have issued 5 “Strong Buy,” 2 “Moderate Buy,” 11 “Hold,” and 5 “Sell” opinion on the stock.
• Value Line gives the company its above-average rating but has a price target of only $18.
• CFRA’s Market Scope rates the stock a “Hold.”
• Morningstar thinks the stock is overly valued by 36% with a fair value of $16.
• 103,590 investors monitor the stock on Seeking Alpha, which rates the stock a “Hold.”

The Bottom Line on SoFi Technologies

SOFI currently has momentum and is hitting new highs. However, many investors and analysts think the double-digit projections of revenue and earnings growth have been fully reflected in the current price.

I caution that SOFI is volatile and even speculative in the current environment, which means investors should use strict risk management and stop-loss strategies.

Today’s Chart of the Day was written by Jim Van Meerten. Read previous editions of the daily newsletter here.

Additional disclosure: The Barchart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.