Key Takeaways
- SoFi stock fell 15.7% in the past month as a hot September inflation report and several analyst target cuts revived fears of higher rates.
- Second-quarter adjusted net revenue rose 40%, and management’s guidance already assumed rate hikes.
- KBW estimates that higher rates could cost SoFi’s fair-value loan book more than $1 billion before hedges, the main risk ahead of third-quarter results on Oct. 27.
- At about 20x forward earnings, the stock looks like a buy, with the Oct. 27 results and the Fed’s Oct. 28 decision as the test.
SoFi Technologies (SOFI) is down 15.7% in the past month (through Monday’s close), while the S&P 500 rose 0.6%. That leaves it down 45.4% in 2026 and within a few cents of its 52-week closing low, with third-quarter results due Oct. 27.
Most of the damage came from rates.
What exactly happened
The month started well. On Sept. 22, SoFi switched on stablecoin settlement across its bank’s card program, and the stock rose. Then October brought the rate worries:
- Oct. 12: KBW’s Tim Switzer cut his target to $15 from $16 and kept his Underperform rating. He warned that higher third-quarter rates could cost SoFi’s loan book more than $1 billion before hedges. The stock fell 3.6%. That evening, StoneX started coverage at Buy with a $25 target.
- Oct. 13: Goldman Sachs cut its target to $15 from $18, a week after TD Cowen trimmed its own to $17.50.
- Oct. 14: September’s inflation report came in hot, and traders put the odds of another Fed hike on Oct. 28 at about 50%. SoFi fell 6.7% to $14.22, a new 52-week closing low.
- Oct. 15: Shares touched $13.86 during trading, then closed up 6.1%, with no company news.
Rates did the damage
KBW’s note explains why a hot inflation print stings SoFi more than most lenders. SoFi carries nearly all of its loans at fair value, so higher rates mark them down, and those losses run through earnings and equity unless hedges offset them. The $1 billion-plus figure is Switzer’s estimate, before any hedge gains.
Management saw higher rates coming, though. SoFi’s guidance already assumed one to two rate hikes when it raised its 2026 revenue outlook to $4.75 billion to $4.85 billion in July. That came after second-quarter adjusted revenue jumped 40% to a record $1.2 billion.
And CFO Chris Lapointe has an answer to the capital worry: fees. SoFi’s loan platform business makes loans that partners fund, and it’s widening that into small-business loans and home equity. At a Goldman Sachs conference on Sept. 8, Lapointe said fee streams like these let SoFi “use less equity to drive even more revenue.”
TIKR tracks 25 analysts on SoFi. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on SoFi, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See SoFi’s Analyst Ratings
Two days that decide the next move
SoFi reports before the open on Tuesday, Oct. 27. Three numbers matter: revenue (consensus is about $1.26 billion), GAAP EPS (about $0.17), and loan platform revenue, which was $143.3 million in the second quarter. If platform revenue climbs with the new volume, that backs StoneX. If more loans stack up on the balance sheet, that backs KBW.
The Fed decides a day later, though the odds of a hike have cooled since the Oct. 14 spike. Analysts still expect normalized EPS to rise from $0.37 in 2025 to $0.59 this year and $0.82 in 2027.
Even KBW expects SoFi to meet consensus, so nothing in this month’s news argues for deep cuts to those estimates.
SoFi Stock Is Cheap for a Reason, but Cheap
The Street’s consensus target has slid with October’s cuts, but at $20.36 it’s still about 42% above Monday’s close.
The spread is wide, though: targets run from $12 to $30.
SoFi also trades at about 20x forward earnings, down from 22x at the start of October. That’s a low price for earnings that analysts expect to grow almost 40% next year.
Rates drove most of this month’s selling. The last quarter we have grew 40%, and Oct. 27 will show whether the third kept pace. At this price, I’d start loading up before then.
A Fed hike on Oct. 28 and another quarter of loans building up on the balance sheet would make KBW’s $15 look a lot more reasonable than StoneX’s $25.
So what is SoFi stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
