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According to the firm, SoFi technologies is poised to receive a cycle of increased engagement, boosting revenue and profits.
Sofi Technologies Inc (NASDAQ: SOFI) stock closed the trading yesterday at $15.45, 6.55% higher than the day’s opening price. The gains widened by approximately 0.32% during the after-hours trading session. Reportedly, the spike has been attributed to news that the SoFi stock could hit a $28 price target in a year. The call was made by Mizuho Financial Group that holds assets in excess of $1.8 trillion.
Besides offering the price target, Mizuho also updated the coverage with a Buy rating. According to the firm, SoFi technologies is poised to receive a cycle of increased engagement, boosting revenue and profits. SoFi stock has hereby gained approximately 24.20% year to date. However, the SoFi stock market has dropped approximately 29.23% in the past three months, obliterating gains made in the past nine months or so.
Having been rated by five Wall Street analysts, SoFi stock received an average rating of Over rating. With a market cap of approximately $11.52 billion as of September 15, 2021, 7.59 p.m EDT. The company is well-positioned financially to take up opportunities presented by Covid’s economic recovery. Moreover, the company has been in existence for almost a decade.
The company went public at the beginning of the year after merging with a SPAC company at a deal worth $9 billion. SoFi is an American online company that focuses on personal finance by providing a suite of financial products including student loan refinancing, mortgages, personal loans among others.
SoFi Stock and the Market Outlook
Despite being on a losing end since going public, SoFi stock has managed to convince investors and shareholders of a brighter future. The growth prospects were deciphered by Mizuho analyst Dan Dolev who saw enormous growth potential.
Notably, Dolev predicted that the company will over the next few years transition from a company that relies on prior financial products suite to “a full-fledged mobile-first, super-app neo-bank with in-house next-gen issuing capabilities.”
Mind you, the global economy has significantly shifted towards fintech companies especially under artificial intelligence and blockchain technology. Despite deriving approximately 83% of its revenue from selling mortgages and student loans last year, Dolev believes the company will shift to mobile cash management. Additionally, the new model will comprise between 30% to 35% of the company’s revenue stream.
However, he clarified that the company is capable of expanding its business without neglecting its prior revenue streams. Thus the growth prospects in the foreseeable future.