Scotiabank raises SoFi stock price target to $26 on strong results

Scotiabank has upgraded its price target on SoFi Technologies (NASDAQ:SOFI) to $26, maintaining a Sector Outperform rating. The financial firm highlighted SoFi's record quarter, showing a significant revenue growth rate of approximately 44% and adjusted EBITDA reaching a 34% margin. This impressive growth reflects strong momentum over the trailing twelve months, with a 41% revenue increase.

SoFi's fiscal 2027 framework exceeded analyst expectations across all metrics, with earnings per share reaching 10% above consensus estimates. Currently, the stock trades at a P/E ratio of 34.7, indicating investor confidence in its future profitability despite recent market volatility. Adjusted losses from fair value concerns amounted to around $800 million, with hedges effectively offsetting most of these losses.

Personal loan risk-adjusted margins stayed above approximately 7.5%, as origination fees replaced coupons as the primary pricing mechanism. Credit performance improved, with personal loan losses at 3.4% and 90-plus day delinquencies remaining flat. Management affirmed that demand for the company's products remains robust, encompassing borrow, spend, save, and invest offerings.

Scotiabank anticipates two additional interest rate hikes this year and another two in 2027, which influenced their guidance. The fiscal 2027 projections are considered the minimum scenario, barring significant macroeconomic changes. According to Scotiabank, the stock price would be roughly 16 times the fiscal 2027 EPS estimate, potentially offering substantial upside from its current trading price of $16.40.

While Scotiabank's target suggests considerable potential upside, InvestingPro analysis suggests the stock may be slightly overvalued at present levels. Investors interested in further analysis can explore SoFi's detailed Pro Research Report, part of over 1,400 reports available on the platform. In related news, SoFi Technologies recently reported its third-quarter earnings, surpassing analyst expectations with adjusted earnings of $0.18 per share and revenue of $1.39 billion.

Following these positive results, multiple analysts adjusted their price targets for SoFi. StoneX raised its target to $27, recognizing a positive earnings outlook, while Needham maintained a Buy rating with a $24 target. Wells Fargo increased its price target to $18, retaining an Equal Weight rating due to strong loan originations.

Despite its neutral stance, BofA Securities raised its target to $16.50. These actions highlight SoFi's robust growth trajectory and reinforce the positive investor sentiment surrounding the company.