SoFi Technologies (SOFI) is back in focus after its latest quarterly update, which paired record membership growth and rising loan originations with higher revenue guidance and new private market fund offerings for SoFi Invest members.

At a share price of US$18.38, SoFi Technologies has seen short term momentum pick up with a 12.69% 7 day share price return and a 13.04% 90 day share price return, while the year to date share price return is down 33.07% and the 1 year total shareholder return is down 16.83%. This is set against a much stronger 112.49% total shareholder return over three years that reflects how investors have reacted over time to its quarterly results, rising net charge offs and expanding product set.

If SoFi’s latest quarter has you thinking about where growth and risk might meet next, it could be worth scanning for other AI focused opportunities using the 29 AI small caps

SoFi Technologies now appears to be a stronger, more complete financial platform, and the stock price has reflected that development. The next consideration is whether the current US$18.38 share price still represents a sensible entry point.

Most Popular Narrative: 20% Undervalued

According to the most followed narrative on SoFi Technologies, the current $18.38 share price sits below an implied fair value of $22.98. This frames the stock as trading at a discount and puts a spotlight on the growth assumptions behind that gap.

Technology markets follow a repeating pattern: extreme fragmentation is always conquered by centralized aggregation. Amazon aggregated retail. SoFi is aggregating the multi-trillion-dollar financial services sector.

By using a best-in-class consumer app to capture 13.7 million high-income members, SoFi has built a self-funding deposit base that legacy banks cannot replicate. Beneath that consumer interface, their B2B Technology Platform is quietly becoming the operating system for global fintechs. Shielded by the regulatory moat of their national bank charter and their pioneering SoFiUSD stablecoin, the company is positioning itself to command the future rails of global digital payments.

The fair value hinges on how far SoFi’s banking super app and B2B platform can scale member growth, fee income and margins. It leans heavily on compound revenue expansion, rising profitability and a valuation multiple more often associated with software leaders than traditional lenders. Curious which specific growth rates and margin profiles sit underneath that $22.98 number.

Result: Fair Value of $22.98 (UNDERVALUED)

However, SoFi Technologies still faces key risks, including potential credit losses if borrower quality weakens and pressure on its technology platform if client growth or transaction volumes slow.

Another View: SoFi Technologies Through a Valuation Multiple Lens

The user generated narrative pegs SoFi Technologies at a fair value of $22.98, which frames the stock as undervalued. Using a different lens, SoFi’s current P/E of 37.3x is well above the Consumer Finance industry average of 9.7x and a peer average of 11.9x, as well as an estimated fair ratio of 25.2x. That kind of premium can either reflect confidence in future earnings or leave less room for error if the story changes. Which side of that trade off are you more comfortable with?

For a closer look at how the current valuation compares with this fair ratio and peers in practice, take a look at the See what the numbers say about this price — find out in our valuation breakdown.

Next Steps

With mixed signals on value and risk around SoFi Technologies, it makes sense to move quickly and review the underlying data for yourself. If you want a structured view of both the upside potential and the key concerns, start with the 2 key rewards and 1 important warning sign

Looking for more investment ideas beyond SoFi Technologies?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.