SoFi Stock Is Trading Near $16 With Earnings in the Past -- Last Chance to Buy Cheap?
Key Points
SoFi added a record 1.1 million customers in the first quarter, with the total now approaching 15 million.
The leadership team decided not to raise full-year guidance, which likely disappointed shareholders.
When investors consider SoFi’s profit forecast, the fintech stock’s current valuation looks more attractive.
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At the end of April, SoFi Technologies (NASDAQ: SOFI) reported financial results for the first quarter, which ended on March 31. The digital banking powerhouse posted a 41% year-over-year increase in adjusted net revenue. And its adjusted diluted earnings per share (EPS) jumped 100%. These were fantastic results.
However, the fintech stock dipped 15% following the announcement. And its shares, which now trade near $16, are 51% off their peak (as of May 20). This business has certainly been performing well, so is now the last chance for investors to buy SoFi while it's cheap?
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Financial momentum continues
During Q1, SoFi continued to show that it's on a path of rapid growth. As mentioned, adjusted net revenue rose 41%. This was driven by the addition of 1.1 million net new customers, bringing the total to 14.7 million.
The business has successfully carved out a niche in the competitive financial services industry by leaning on its technological capabilities to deliver a superior user experience. The expansion of the customer base proves SoFi's value proposition.
This has led to tremendous profit gains. SoFi's adjusted net income margin was 15.3% in the most recent quarter, up from 9.2% in the year-ago period.
It wasn't all good news, though. The company lost an important customer within its technology platform segment. As a result, revenue here fell 27% compared to Q1 2025. This is obviously not an encouraging development.
But on a positive note, the technology platform accounted for less than 7% of SoFi's total revenue mix in the latest quarter. The business still registered monster growth.
Market weakness creates an opportunity
Despite the strong financial results, investors were likely disappointed that SoFi's management team did not raise guidance for the full year. Shares fell 15% after the news, which may also partly be attributed to the lingering effects of the March report by Muddy Waters Research, which questioned SoFi's accounting practices.
These concerns might not be warranted given the company's impressive momentum. Investors can now buy SoFi stock while it's well below its record price from November 2025.
The current price-to-earnings ratio of 35.4 is also well below its level at the start of 2026. This valuation looks more attractive after you realize the leadership team is calling for 40% (at the midpoint) annualized adjusted EPS growth over the next three years.
It's impossible to say that this is the last time to buy shares cheaply and on the dip. SoFi's business is in solid shape. However, market sentiment is constantly shifting in unpredictable ways. The stock could continue to weaken before things improve.
But for long-term investors interested in owning companies for five years or more, this is an opportune time to consider buying SoFi.
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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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