SOFI - SoFi Technologies: Sell-Off After Double Beat Guidance Hike Another Opportunity
2024-05-03 09:00:00 ET
Summary
- SoFi Technologies shares dropped over 10% after Q1 earnings, despite beating revenue and EPS expectations and increasing 2024 guidance.
- The market is focused on Q2 guidance, which indicates a decline in SoFi's top and bottom line, rather than the long-term potential of the company.
- SoFi's engagement across its ecosystem is expanding, with record member growth, increased deposits, and a growing number of products used by members.
Unlike many previous quarters, SoFi Technologies ( SOFI ) shares skipped the massive pop before selling off after earnings. On Monday, 4/29, SOFI released a triple beat pre-market as its adjusted revenue beat by $21.12 million, GAAP EPS beat by $0.01, and management increased 2024 guidance across the board. Rather than the shares jumping higher, they went directly to the selloff phase, dropping by more than 10% on Monday and then by another 4% on Tuesday, as shares couldn't hold the $7 level. There was a lot of excitement going into Q1 earnings as shares made a run past $8 in the after-hours heading into the weekend, but once again, Mr. Market had other plans for SOFI. It seems as if the street and the shorts are focused on Q2 guidance, which indicates a QoQ decline in SOFI's top and bottom line rather than management increasing guidance for their 2024 fiscal year and delivering on their objectives. At this point, you either believe that SOFI isn't just a bank and can deliver on its critical success factors, or you view it as just a bank. There was nothing in the earnings report that made me less bullish than before because all the pieces for SOFI's long-term plan are coming together. It may take longer than many would have liked for shares of SOFI to get back into the double digits, and I believe that the market is missing the bigger picture when it comes to SOFI....
SoFi Technologies: Sell-Off After Double Beat, Guidance Hike, Another Opportunity