SoFi's stock climbs, with these twin engines carrying the rally further

MW SoFi's stock climbs, with these twin engines carrying the rally further

By Emily Bary

Upstart's upbeat lending results could be giving SoFi investors more optimism, according to a Mizuho analyst

SoFi Technologies Inc. shares are gaining more steam in Friday's action, with two big forces behind the latest move.

Mizuho analyst Dan Dolev thinks results from fellow personal lender Upstart Holdings Inc. $(UPST)$ have SoFi (SOFI) investors feeling more encouraged as well, as Upstart's Thursday afternoon earnings report showed that company's risk profile coming down.

"Upstart is injecting jet fuel into this trade," Dolev said of SoFi's Friday move. SoFi reported its own results last week, showing a more favorable risk profile as well.

Read: Upstart's return to 'growth mode' helps send the AI lending stock higher

SoFi shares are up 3% in Friday morning action and ahead 12.6% over their current four-session winning streak. The stock has also climbed 85% over a three-month basis.

Dolev also sees SoFi's stock action over the last few days as part of a "catch-up" Trump trade. Bank stocks rose sharply on Wednesday after Donald Trump won a second term as president, but SoFi shares didn't rise as much as many others in the pack. While the SPDR S&P Bank ETF KBE jumped nearly 12% in Wednesday's action, SoFi's stock was up less than 5%.

"People always find a reason to poke holes in SoFi," Dolev told MarketWatch. The neobanking company offers lending, savings and other financial-services products, but some investors treat it like it's "not a real bank," perhaps why SoFi's stock "flew under the radar" in Wednesday's sector rally, he added.

Don't miss: Upstart's stock roars higher. Here's why analysts say the tide is turning.

Even with the moves higher in subsequent days, Dolev still sees room to run for SoFi's stock, which he rates at outperform with a $14 target. "It's a great company, it's very well diversified and now the risk profile of borrowers is coming down," he said.

-Emily Bary

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November 08, 2024 11:34 ET (16:34 GMT)

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