Shares of SoFi Technologies (NASDAQ:SOFI) plunged today, which can be attributed to an analyst downgrade. Indeed, David Chiaverini of Wedbush changed his rating on the stock from Hold to Sell while assigning a price target of $2.50 per share. For reference, his previous price target was $5 per share.
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Chiaverini believes that SoFi will likely need to perform an equity raise later this year as fee income from loan applications and sales could plummet soon. Since the company is not profitable, this decline in income could delay profitability just enough to where capital will need to be raised at unfavorable terms.
However, most Wall Street analysts are optimistic about SOFI stock, with an overall consensus price target of $7.65 per share. As a result, this implies over 70% upside potential, as indicated by the graphic above.