SoFi Stock Lost 82% Once Before, Then Rose About Sevenfold. It's More Than 50% Below Its High Again.

SoFi Technologies (SOFI -0.92%) has experienced a dramatic rollercoaster in its stock price. Initially, the stock skyrocketed, only to plummet by 82% before ultimately reaching new highs three years later, climbing 650%. However, it has since fallen 54% from that peak in just a few months, leaving investors questioning whether it represents a risky investment or a potential opportunity.

Despite the volatility, SoFi has consistently demonstrated strong quarterly performance. Revenue, customer base, product adoption, and profits have all been growing at double-digit rates, with the company adding 1.1 million members and 2.2 million products in the past year. This indicates that its cross-selling strategy is successful, as 51% of new products come from existing customers.

However, the market has not been overly impressed. While the Tech Platform segment is experiencing a decline due to the loss of a major customer and management's failure to raise net income guidance, SoFi's overall growth and efficiency are promising. The company is launching innovative products, such as a tokenized deposit account for cryptocurrency, targeting its younger demographic.

With a P/E ratio of 31 and a price-to-book ratio of 1.7, SoFi is still comparatively smaller than traditional banks but is growing at a much faster pace. As it continues to introduce new products and expand its customer base, there is potential for the stock to return to its previous highs and even surpass them. However, investors should exercise caution and monitor its performance closely, especially during its upcoming earnings report.