SoFi Technologies (SOFI) stock: Piper Sandler is optimistic about 19% upside

TLDR

Contents

TLDR

Refinancing Opportunities
Capital and Risk
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Piper Sandler covers SoFi Technologies for the first time, giving an "overweight" rating, with a target price of US$22, and an expected potential upside potential of 19%.

Piper Sandler analyst Patrick Moley pointed out that SoFi's integrated financial platform was the main catalyst, with product numbers growing 43% year-on-year in the second quarter.

SOFI shares have risen 18% in the past three months, but have still fallen nearly 30% over the year.

The stock is trading at approximately US$18.33, and Piper Sandler predicts a compound annual growth rate of 22% in revenue from 2026 to 2028.

Wall Street is generally cautious, with 13 of 27 analysts maintaining a "hold" rating and 5 recommending "sell."

On Monday, Patrick Morley of Piper Sandler covered SoFi Technologies (SOFI) for the first time, giving him an "overweight" rating and setting a price target of $22. The stock is trading at around $18.33, meaning about 19% room for upside.

This optimistic stance makes Morley one of the few bulls on Wall Street. According to FactSet data, of the 27 analysts covering the stock, only 9 recommend buying, 13 are neutral and 5 recommend selling.

SOFI shares rose about 0.4% on Monday, trading close to $18.36.

SoFi Technologies, Inc.（SOFI）

Morley's valuation method is to apply a price-to-earnings ratio of approximately 25 times its fiscal year 2027 earnings forecast. The company expects SoFi to generate revenue of $4.89 billion in 2026, or earnings per share of 63 cents. Looking forward to 2027, Piper Sandler estimates revenue will reach $6.14 billion and earnings per share of 88 cents.

This optimistic investment argument is based on two basic elements: a large and underserved integrated loan and debt market, and a product portfolio that will gradually increase customer engagement.

Existing members accounted for more than half of new product activations in the second quarter, according to CEO Anthony Noto. The number of products increased by 43% year-on-year, exceeding the membership growth rate of 35%. Morley believes this difference confirms that customers are accepting multiple SoFi products, thereby increasing customer lifetime value.

SoFi has diversified significantly beyond its original lending business. The platform now covers checking and savings accounts, investment products, credit cards and insurance services. Morley described the strategy as a comprehensive financial services solution aimed at gradually strengthening customer relationships.

Refinancing opportunities

An important part of Morley's investment argument revolves around refinancing potential. SoFi mainly serves consumers in their late 20s to early 40s, who have good credit status but carry large amounts of credit card or student loan debt.

SoFi offers annual interest rates up to 50% lower than traditional credit card rates. Morley believes this competitive advantage allows the company to take full advantage of refinancing activities when interest rates are adjusted, and describes credit card and student loan refinancing as "two products that are closely related to the debt structure of its core customers."

Capital and Risk

As of the end of the second quarter, SoFi's total capital ratio was 18.8%, while SoFi Bank's was 15.3%. Both figures far exceed the regulatory threshold of 10.5%, providing room for expanding the loan portfolio.

Piper Sandler predicts a compound annual growth rate of 22% in revenue from 2026 to 2028, and an adjusted EBITDA growth rate of 27% for the same period.

However, the company also pointed to multiple risk factors, including rising credit losses, interest rate fluctuations, value-diluting acquisitions, and large expenditures but limited short-term revenue.

The stock has fallen nearly 30% this year after a short seller report said SoFi was running a "financial engineering treadmill." Since then, shares have rebounded 18% in the past three months.

Piper Sandler called SoFi's current valuation "an attractive entry point" for long-term investors and believed that given its banking penetration and affluent customer base, the company "should enjoy a premium valuation relative to its peers."