Analyst Mihir Bhatia of Bank of America Securities maintained a Sell rating on SoFi, with a price target of $17.50.
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Mihir Bhatia has given his Sell rating due to a combination of factors, primarily focusing on SoFi’s current valuation. Despite SoFi’s strong third-quarter performance, with revenues and earnings per share surpassing expectations, the stock is trading at a valuation that Bhatia considers high compared to its peers. This elevated valuation is based on the projected earnings per share for 2026, which suggests that the stock is priced at approximately 44 times the mid-point of the guidance range.
Additionally, while SoFi has raised its guidance for key financial metrics, including revenue and EBITDA, the stock’s price objective remains significantly lower than its current trading price. This discrepancy indicates a cautious outlook on future stock performance. Although SoFi’s loan platform business shows robust growth and there are positive developments in partnerships and product enhancements, these factors are not enough to offset concerns about the stock’s high valuation, leading to the Sell rating.
In another report released today, KBW also maintained a Sell rating on the stock with a $20.00 price target.