To The Moon

🌟🌟🌟$SoFi Technologies Inc.(SOFI)$ is a Fintech company that  has a mission to help people reach financial independence.  Founded in 2011, SoFi has since developed a comprehensive suite of financial products that offers the speed, selection, content and convenience that only an integrated digital platform can provide.

SoFi is a full financial services platform that offers lending services, banking products and more on its digital app.  It has no physical branches and it targets the students and young professionals.   SoFi is disrupting traditional banking in doing so. 

SoFi has reported an excellent Q2 24 earnings report on July 30, marking its 3rd consecutive quarter of GAAP profitability.  SoFi 's members increased 41% year over year to almost 8.8 million.  Its adjusted net revenue increased by 20% and had a net income of USD 18 million.  SoFi' s management raised its outlook for 2024 adjusted net revenue and earnings per share and is expecting positive net income for the 3rd quarter and the full year. 

SoFi has been expanding its business to include a wider array of financial services.  In addition to its core lending segment, SoFi has 2 other segments.  They are the Tech platform or the white label financial infrastructure services under the Galileo brand and the non lending financial services.

These 2 new businesses are growing at a much faster rate than lending and they have a wider appeal to a larger population.  They also create a wider service base from which members can increase their engagement. 

Lending accounted for 55% of revenue in Q2 which was USD 341 million in Q2, an increase of 3% from last year.  Lending contribution profit was USD 198 million, an 8% increase from last year.  Financial services and Tech platform profit combined was USD 86 million. 

The key driver of SoFi's performance is to expand its financial services to become a one stop shop for financial services in order to drive future growth.  These would include new lending products, investment options and insurance services in order to cater to a broader range of its members' financial need. 

The other important driver of SoFi's growth has been obtaining a national banking charter which allows it to use its increasing deposit base to fund its lending operations more efficiently.  This access to lower cost funds is expected to drive net interest income growth, enhancing profitability as SoFi scales its banking operations.

Another driver of SoFi's growth is SoFi's strategy of cross selling its wide array of financial products to increase the average number of products per customer.   This integrated approach is expected to improve customer retention and lifetime value, thereby boosting SoFi's overall revenue and profitability. 

SoFi is currently up 5.1% in the past week but down 17% year todate.  In 2023, SoFi has dropped 9%.

Wall Street Analysts are bullish on SoFi with a Buy rating, Target price of USD 8.89, an upside potential of 11%.

I have just started to invest in SoFi last week as I believe that this Fintech stock is undervalued and oversold.  I like that it has grown its user base by 41% in Q2 24 and has been profitable for 3 consecutive quarters.  SoFi's management has also guided for positive net income for the 3rd quarter and the full year as well. 

I believe SoFi has lots of exponential growth ahead and could even be a multi bagger in the future.   So SoFi is definitely a Buy for me, not a Bye. 

As Warren Buffett likes to say, "It is far better to buy a wonderful company at fair price, than a fair company at a wonderful price." And his favourite holding period is Forever. 

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