Buy, Sell, Or Hold SOFI Stock At $15?

June 20th, 2025 by Trefis Team
SOFI: SoFi Technologies logo
SOFI
SoFi Technologies

SoFi stock (NASDAQ: SOFI) has jumped more than 15% over the past month. This upward move seems to be partially driven by Chime’s successful IPO, which has positively influenced sentiment across the fintech space. After a prolonged lull in public offerings, fintech firms like Chime are finally making their market debut—though at more conservative valuations and expectations. See – Strong Growth, Improving Earnings Make Chime Stock A Buy?

Despite this recent rally, SoFi shares, which currently trade near $15, appear overvalued. We have several concerns suggesting the stock’s present valuation may be stretched. Our view is based on a thorough assessment of SoFi’s valuation in relation to its operating performance, historical metrics, and financial health. We evaluated SoFi Technologies on key criteria such as Growth, Profitability, Financial Stability, and Resilience in Downturns. Overall, the company displays only moderate performance and stability.

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How Does SoFi Technologies’ Valuation Compare To The S&P 500?

Based on sales and earnings multiples, SOFI stock appears expensive compared to the overall market.

  • SoFi Technologies has a price-to-sales (P/S) ratio of 5.9 versus the S&P 500’s 3.1
  • Its price-to-earnings (P/E) ratio stands at 32.9, higher than the index’s 26.9

How Has SoFi Technologies’ Revenue Grown In Recent Years?

SoFi has posted strong revenue growth over recent years.

  • Over the last 3 years, revenue has expanded at an average annual rate of 36.2% (vs. 5.5% for the S&P 500)
  • In the past 12 months, revenue grew 25.9% from $2.2 billion to $2.8 billion (vs. 5.5% for the S&P 500)
  • In the latest quarter, revenue rose 31.7% to $772 million from $586 million a year earlier (vs. 4.8% for the S&P 500)

How Profitable Is SoFi Technologies?

SoFi’s margins are well below average compared to other companies covered by Trefis.

  • Operating Cash Flow (OCF) over the period was $-1.8 billion, indicating a very poor OCF margin of -65.6% (vs. 14.9% for the S&P 500)
  • Net income for the last four quarters was $482 million, resulting in a moderate net income margin of 17.2% (vs. 11.6% for the S&P 500)

Is SoFi Technologies Financially Stable?

SoFi’s balance sheet appears solid.

  • As of the latest quarter, debt stood at $3.1 billion against a market cap of $17 billion, implying a moderate Debt-to-Equity Ratio of 19.8% (vs. 19.4% for the S&P 500). [Note: Lower is better]
  • Cash and equivalents total $4.2 billion, representing a strong Cash-to-Assets Ratio of 11.2% out of $38 billion in total assets

How Has SOFI Stock Held Up In Market Downturns?

SOFI has underperformed the S&P 500 during recent market downturns. As hopes rise for a soft landing, investors should also consider potential downside risks. Our dashboard How Low Can Stocks Go During A Market Crash shows how major stocks performed during past market crashes.

Inflation Shock (2022)

  • SOFI plunged 83.3% from $25.78 on Feb 1, 2021, to $4.30 on Dec 7, 2022, versus a 25.4% drop in the S&P 500
  • The stock has not yet returned to its pre-crisis high
  • The post-crisis peak was $18.03 on Jan 23, 2025, while the current price is around $15.40

COVID-19 Pandemic (2020)

  • SOFI fell 46.7% from $25.78 on Feb 1, 2021, to $13.75 on Aug 17, 2021, vs. a 33.9% decline for the S&P 500
  • The stock still lags its pre-crisis peak

Putting It All Together: What Does It Mean For SOFI Stock?

Here’s how SoFi stacks up across key performance areas:

  • Growth: Extremely Strong
  • Profitability: Very Weak
  • Financial Stability: Strong
  • Downturn Resilience: Extremely Weak
  • Overall: Neutral

Despite strong revenue growth and a healthy balance sheet, SoFi’s elevated valuation relative to its historical multiples and weaker profitability raise concerns. The company’s three-year average P/S ratio was 4.5—well below the current 5.9.

While Chime’s IPO and SoFi’s user base expansion may justify some premium, it’s important to weigh external risks such as high interest rates and geopolitical instability. Historically, SoFi stock has not shown strong resilience under such conditions.

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