SoFi Technologies (SOFI) is set to report its third-quarter earnings tomorrow, October 28, and the options market is signaling a potentially sharp reaction. Traders are bracing for a stock swing of nearly 12% in either direction, based on current pricing in the options chain. Interestingly, the potential swing is much larger than SOFI’s long-term average post-earnings move of 2.32%.
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Of late, the company has been in the spotlight for its growing digital banking business, student loan activity, and expansion into financial services. However, investors are likely concerned about the impact of regulatory changes affecting student loans and fintech platforms, along with mixed consumer sentiment on SoFi’s upcoming earnings report.
Investors will be watching how falling interest rates, budget changes, and consumer trends affect SoFi’s loan, deposit, and profit trends, especially as student loan payments have resumed and competition in online banking is heating up.
Expectations From SOFI’s Q3 Results
Wall Street is expecting SOFI to report earnings of $0.08 per share, up 60% from the same period last year. Meanwhile, analysts project revenues of $888.91 million, down from $989.49 million in the year-ago quarter.
Ahead of the company’s Q3 earnings, JPMorgan analyst Reginald Smith increased the price target for SoFi stock to $26 from $24 while maintaining a Hold rating. The Top analyst highlighted SoFi’s consistent history of beating expectations and raising guidance, which supports a more optimistic outlook for the stock.
Smith also noted stable credit performance and strong demand from loan buyers as key reasons for the target hike.
Is SOFI Stock a Good Buy?
Turning to Wall Street, SOFI stock has a Hold consensus rating based on five Buys, eight Holds, and four Sells assigned in the last three months. At $22.46, the average SOFI stock price target implies a 24.83% downside risk.
