Veteran analyst Stephen Guilfoyle, whose career stretches back to the 1980s on the floor of the New York Stock Exchange, tries not to repeat himself, but when it comes to SoFi Technologies, (SOFI) , he'll gladly make an exception.
Guilfoyle, who writes a regular trading column for TheStreet Pro, recently said that he doesn't like to weigh in on the same stock more than once a month.
Related: Veteran trader updates view on Rocket Lab USA, SoFi before earnings
"And I really, really don't like to write on the same stock twice within two weeks, especially when I was off for a week in the middle," he said. "This is, however, a necessary update."
Guilfoyle felt compelled to write up SoFi after the popular fintech's shares surpassed the $10.25 price target that he had reiterated on Oct. 9.
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He promptly boosted his price target to $13.25, but then SoFi reported better-than-expected third-quarter earnings, prompting another update from him on Oct. 29.
Brian Ach/Getty Images for TechCrunch
SoFi CEO Noto says business is booming
"This quarter was the strongest quarter in our history," Chief Executive Anthony Noto said in a statement.
"Our results reflect how SoFi is consistently achieving durable growth, how our innovation and brand building are attracting more members and clients to our platform than ever before, and how we are delivering strong and improving returns," he said.
Related: Veteran trader reworks his stock price target for SoFi Technologies
For those who don't know, Noto, a star linebacker on the U.S. military academy's football team and a graduate of Army Ranger School at Fort Benning (now Fort Moore), worked for Goldman Sachs, the National Football League and Twitter before taking over the top spot at SoFi in 2018.
SoFi reported net income of 5 cents a share. Revenue rose 30% year-over-year to $697 million. Analysts were expecting earnings of 4 cents a share on revenue of $632.3 million.
Noto said that the financial services and tech platform segments now make up a record 49% of SoFi's adjusted net revenue, up from 39% a year earlier.
"In the third quarter, these businesses grew revenue by a combined 64% year-over-year, a testament of our continued execution and deliberate shift towards capital-light, higher [return on equity], fee-based revenue streams," he said.
Home loans posted its best refinancing quarter since the second quarter of 2022, the company said, with home purchases and refinancings growing 23% sequentially, while home equity loan volume increased 44% from a year earlier.
"Perhaps most importantly, the firm's on-balance-sheet 90-day personal loan delinquency rates decreased to 57 basis points from 64 basis points sequentially," Guilfoyle said.
New member additions were more than 756,000 in the third quarter of 2024, and total members reached nearly 9.4 million, up 35% from 7 million a year earlier.
And more people know the SoFi story now.
The company said that it ended the quarter with its highest average unaided brand awareness — a measure of how well a brand is remembered without any prompting — of all time, up 40% year-over-year as SoFi “pursues its vision to become a top 10 financial institution.”
Analyst suggests SoFi 'bears are confused'
The company said it expected adjusted net revenue of $2.535 to $2.55 billion, which was $85 million higher than the prior guidance range of $2.43 to $2.47 billion. The figures estimate 22% to 23% annual growth compared with 17% to 19% previously.
SoFi shares were down 6% at last check, but the stock is up 5.7% year-to-date and has surged 53.1% from a year ago.
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Mizuho analysts maintained an outperform rating on SoFi Technologies and a $14 price target on the shares.
The investment firm noted that the company’s shares were trading down “despite a stellar quarter,” and it said the “bears are confused, as worries are unmerited.”
SoFi is expanding its lending capabilities via its loan platform business to address concerns that it would not be able to grow due to capital constraints, Mizuho said.
The firm reiterated that any worries about a capital raise are “unmerited” as SoFi's total capital ratio should be above 16% at the end of the year.
Jefferies analysts raised their price target on SoFi Technologies to $13 from $12 and maintained a buy rating on the shares following the quarterly report.
Guilfoyle's plan? Buy more SoFi shares
Full-year 2024 guidance was raised more than the Q3 beat, the firm said, adding that SoFi is “well-positioned for a rate cut environment.”
Guilfoyle, a longtime SoFi supporter, said the company had an "excellent quarter" and offered "muscular guidance."
"Noto is not missing a beat," he said. "Long-time investors in SOFI, I am sure, have noticed that every time the stock has dipped, really since Noto took on this role, he has added to his stake in the firm with his own cash. Noto, as he has shown throughout his career, is a leader."
Like Noto, Guilfoyle's confidence in the company's outlook has him planning to buy more SoFi stock.
"The stock popped nicely just after these earnings were released but has come in sharply now that the opening bell has rung. l expect to add to my long position this morning," said Guilfoyle. "We emphatically reiterate our target price of $13.50 at this time with an upward bias."
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