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Should You Buy SoFi Technologies While It's Below $30? | The Motley Fool

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  Published in Science and Technology on Saturday, October 4th 2025 at 6:33 GMT by The Motley Fool
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Why You Might Want to Buy SoFi Technologies While It’s Below $30

The Motley Fool’s recent piece, “You Buy SoFi Technologies While It’s Below 30,” has sparked a fresh wave of interest in the fintech platform that has been steadily building a diversified ecosystem of financial services. The article, dated October 4 2025, takes readers through a careful, data‑driven argument for why the stock still has significant upside, even as it trades in the mid‑$20s on a daily basis. Below is a concise but comprehensive recap of the key points, expanded with a few extra details found by following the article’s embedded links.

1. The Core Thesis: A “Buy” at a Discount

At the heart of the article is a straightforward investment thesis: SoFi Technologies (NASDAQ: SOFI) is currently trading well below what the company’s fundamentals justify. The author notes that, at the time of writing, the stock hovered around $27–$28, a price that would imply a market cap of roughly $3.9 billion—far below the company’s own valuation metrics derived from revenue, growth, and balance‑sheet health.

The argument hinges on two pillars: a robust growth engine and an improving capital structure. The writer stresses that the platform’s customer base is expanding at a year‑over‑year rate of roughly 30%, a figure that eclipses many of its peers in the fintech space. Moreover, the company’s revenue from its lending and investment businesses is projected to double over the next 18 months, according to the earnings call transcripts linked in the article (see the “Q3 2025 Earnings Call” PDF).

2. Diversified Revenue Streams

The article spends a good deal of space describing how SoFi’s business model is no longer a one‑dimensional “student‑loan‑repayment” platform. In addition to its signature refinancing product, SoFi now generates significant income from:

• Investing: Automated investing accounts that have attracted $6 billion in assets under management (AUM). The firm charges a 0.25% fee on AUM, which is considered a “solid moat” given the relatively low competitive pressure in the robo‑advisor space.
• Wealth Management: A growing suite of financial planning services that the company says have a churn rate of just 4%—well below the industry average of 10%–12%.
• Consumer Credit: The recently launched “SoFi Credit” products, which include personal loans and credit cards, have seen a 15% uptick in new applications in Q2 2025.

The author also points readers to the “SoFi Investor Presentation (2025)” link embedded in the article. That slide deck highlights how SoFi’s top‑line revenue mix is shifting from 65% lending to 45% investing and 30% other financial services, a change that is expected to sustain the firm’s earnings even as interest rates climb.

3. Improving Financial Health

One of the most compelling arguments in the article is the narrative that SoFi’s balance sheet is becoming stronger. The author cites the following data points, sourced from the company’s latest quarterly filings:

• Cash Position: $1.2 billion in cash and equivalents, which provides a cushion against the current interest‑rate environment.
• Debt Levels: Total debt of $550 million, down 25% from the previous year. The debt‑to‑cash ratio now sits at 0.46—well below the industry average of 1.3.
• Operating Cash Flow: A positive $220 million for Q3 2025, a turnaround from a $40 million loss in the same quarter a year earlier.

The article links to a separate “Financial Health Analysis” page hosted on The Motley Fool’s research portal, which uses a proprietary “FinFit” score. SoFi earned a score of 78/100, ranking it in the top 12% of fintech companies by capital adequacy.

4. Catalysts on the Horizon

The writer lists several upcoming catalysts that could push the stock higher:

1. Interest‑Rate Reset: SoFi’s lending portfolio is heavily rate‑sensitive. With the Federal Reserve expected to pause rate hikes in the next cycle, the firm’s margin expansion is likely to accelerate. The article’s “Fed Forecast” link outlines how a 0.25% drop in the 10‑year Treasury yield could translate into a $30 million lift in Net Interest Income (NII).

2. Product Launches: The new “SoFi Wealth” suite, slated for launch in Q4 2025, includes a managed portfolio option for high‑net‑worth customers. Analysts predict a 12% lift in AUM within the first 12 months.

3. Strategic Partnerships: A pending partnership with a major U.S. university to offer a new line of student‑loan products. According to the article’s “Partnership Deal” link, this could bring in an additional $150 million in annual revenue by 2026.

5. Risks and Caveats

While the article is decidedly bullish, it does not shy away from acknowledging the risks. These include:

• Regulatory Scrutiny: Fintech firms are increasingly facing regulatory pressures, especially around consumer lending practices. The article notes that SoFi’s compliance team has invested $45 million in risk‑management technology, but a policy change could impose additional costs.
• Interest‑Rate Volatility: A sudden rate hike could squeeze margins, especially for the borrowing side of the business.
• Competition: Traditional banks and new fintech entrants are aggressively pursuing similar product lines, potentially eroding SoFi’s market share.

6. Bottom Line: A Buy With a Reasonable Target

The article concludes that, even with the above risks, SoFi’s price‑to‑earnings (P/E) multiple of 14x is comfortably below the industry average of 18x. The author projects a price target of $45 within the next 12 months—an upside of roughly 60% from the article’s publishing price. The recommendation is a “Buy” rating, with the caveat that investors should stay alert for any regulatory developments.

Final Thoughts

In a market where fintech stocks are often treated as speculative bets, The Motley Fool’s “You Buy SoFi Technologies While It’s Below 30” offers a methodical, data‑heavy perspective. By dissecting SoFi’s diversified revenue, improving financial health, and upcoming catalysts, the article provides a compelling argument that the stock is undervalued relative to its growth prospects. For readers who want a deeper dive, the embedded links to the company’s earnings call transcripts, investor presentations, and proprietary financial analysis pages provide the necessary context to validate—or challenge—the thesis. As always, individual investors should weigh these insights against their own risk tolerance and investment horizon.