3. SoFi Technologies Inc. (NASDAQ:SOFI)
Share Price as of May 12: $13.18
Number of Hedge Fund Holders: 43
SoFi Technologies Inc. (NASDAQ:SOFI) provides various financial services that are personalized through AI and data science. It operates through 3 segments: Lending, Technology Platform, and Financial Services. One of the company’s platforms includes Technisys, which is a cloud-native digital & core banking platform for software licenses and associated services.
In Q1 2025, the company’s technology platform generated $103 million in net revenue, which was a 10% year-over-year increase. While the number of accounts slightly decreased by 6% year-over-year to 158 million, revenue still grew by 10%, with similar growth and potential acceleration expected in Q2. This is attributed to the monetization of existing clients and new deals signed in new client segments, such as a first-of-its-kind reward debit program with Wyndham Hotels and Resorts.
SoFi Technologies Inc. (NASDAQ:SOFI) anticipates that new client wins in the tech platform business will have an impact on revenue in 2026 and beyond. William Blair analyst Andrew Jeffrey kept a bullish stance on the stock, giving it a Buy rating on April 25 due to the company’s strong market position and financial performance, which is evidenced by the 48% year-over-year growth in ARPU.
Patient Capital Management expressed optimism for the company’s future and stated the following regarding SoFi Technologies, Inc. (NASDAQ:SOFI) in its Q4 2024 investor letter:
“The top performers in the fourth quarter were once again Financials and Travel names. We’ve been over-indexed to them since the pandemic, which has served us well. We strategically added to certain financial names like SoFi Technologies, Inc. (NASDAQ:SOFI) and Coinbase Global Inc. (COIN) during the year. Both companies rebounded strongly in the fourth quarter.
Sofi Technologies Inc. (SOFI) was a standout in the quarter, climbing 95% and up 156% from the intra-day lows in June. The company benefited from Fed rate cuts and the market’s growing optimism that the economy will avoid a recession. The company continues to grow its customer count while successfully cross selling into their loans and financial service products. In the quarter, we saw the company take on a new revenue stream by originating loans for third parties, creating an attractive balance sheet-light revenue source, helping improve return on equity and margins. Sofi is early in its life cycle, currently being a small player in a very large total addressable market (TAM). With their strong management team, we believe the company will continue to deliver on their guidance of strong growth and expanding margins.”
