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SoFi Technologies: Irrational Hit

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  •  SoFi Technologies oddly fell hard following an initial big rally on the strong Q3'22 earnings report.
  • The fintech expects to benefit from the student loan moratorium ending January 1, along with a potential blocking of the loan forgiveness plan.
  • Investors appear irrationally fearful the digital bank isn't taking enough loan provisions due to loans being held longer before being sold.
  • The stock is cheap at 15x conservative 2023 adjusted EBITDA targets.
  • This idea was discussed in more depth with members of my private investing community, Out Fox The Street. Learn More » 

After an odd selloff following strong Q3'22 earnings, SoFi Technologies (NASDAQ:SOFI) is poised to finish the rally the stock started. The fintech has been maligned for not taking charges on loans held on the balance sheet, but the company is poised to benefit whether holding or ultimately selling the personal loans. My investment thesis remains ultra bullish on the growth story for SoFi.

Read the full article on Seeking Alpha. 

Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Update - Nov. 21

Another part of the short attack... using politicians to make up a baseless crypto claim. SoFi has an immaterial crypto business, but the stock has dipped below $5 nonetheless. 

-SoFi Technologies (NASDAQ:SOFI) dropped 6.3% after legislators sent letters to financial regulators urging them to review the company's cryptocurrency trading activities.
-A group of senators, including Sherrod Brown (D-OH), Jack Reed (D-RI), Chris Van Hollen (D-MD), and Tina Smith (D-MN), sent letters to Federal Reserve Vice Chair for Supervision Michael Barr, FDIC Acting Chair Marty Gruenberg, and Acting Comptroller Michael Hsu, warning that SoFi's (SOFI) crypto trading may be violating regulatory requirements.
-"SoFi's (SOFI) digital asset activities pose significant risks to both individual investors and safety and soundness," the lawmakers wrote. "It is imperative that the Fed, FDIC and OCC ensure that SoFi complies with all consumer financial protection and banking regulations."

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