Pre-Q4 Earnings: Is SoFi Technologies Stock a Portfolio Must Have?

SoFi Technologies, Inc. SOFI will report its fourth-quarter 2024 results on Jan. 27, before the bell.The Zacks Consensus Estimate for earnings in the to-be-reported stands at 12 cents, indicating 133.3% growth from the year-ago reported quarter. The consensus estimate for total revenues stands at $2.54 billion, indicating 22.3% year-over-year growth. There has been no change in analyst estimates or revisions lately.See the Zacks Earnings Calendar to stay ahead of market-making news.Image Source: Zacks Investment ResearchThe company’s earnings surpassed the Zacks Consensus Estimate in all the last reported quarter, with a 25% earnings surprise.SoFi Technologies, Inc. Price and EPS Surprise SoFi Technologies, Inc. price-eps-surprise | SoFi Technologies, Inc. QuoteSOFI May Deliver Q4 Earnings BeatOur proven model predicts a likely earnings beat for SOFI this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.SOFI has an Earnings ESP of +1.88% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.SOFI’s Strong Segmental Growth Should be the Driver in Q4We expect a significant year-over-year improvement in the company’s top line in the to-be-reported quarter, driven by healthy business from the Financial Services and Technology Platforms segments.The consensus estimate for Financial Services revenues is pegged at $255 million, indicating 83.5% year-over-year growth. The consensus mark for Technology Platforms revenues is pegged at $110 million, indicating 13.4% year-over-year growth. The lending segment is expected to decline 5%.SOFI Stock is in a Great MoodThe company’s shares have witnessed a notable surge of 148% in the past six months. This rise is significant, especially compared to the 16% growth of its industry and the 13% rise of the Zacks S&P 500 composite.Image Source: Zacks Investment ResearchCurrently, the stock appears to be overvalued. The forward 12-month Price/Earnings ratio stands at 59.34X forward earnings, which is way higher than the industry’s average of 16.5X. It is trading above its 50-day moving average.Investment ConsiderationsThe demand for online financial platforms is expected to rise, and SOFI's technology platform, Galileo, is integral to its banking business and is being adopted by other financial firms. This expansion positions SOFI to capture more market share from traditional banks. Conventional banking giants like JPMorgan JPM, Bank of America BAC and Wells Fargo WFC are more mature and are experiencing slower growth.The Federal Reserve's recent rate cuts have significantly boosted SOFI by alleviating pressure on its lending business. Lower interest rates reduce borrowing costs, encouraging more customers to take loans and refinance existing ones. This improves SoFi’s loan origination volumes and enhances its overall profitability.SOFI's student loan-refinance business stands due to less generous loan-forgiveness policies under the Trump administration. Stricter forgiveness criteria may prompt borrowers to seek refinancing options to lower repayment costs, creating opportunities for SoFi to expand its customer base.SOFI is a BuySOFI presents an attractive investment opportunity ahead of its fourth-quarter 2024 earnings report. With a projected 133.3% year-over-year earnings growth and a 22.3% revenue increase, the company’s robust performance reflects strong segmental growth in Financial Services and Technology Platforms.The demand for online financial platforms and SOFI’s innovative offerings, like Galileo, position it to capture market share from traditional banks. Recent Fed rate cuts enhance its lending potential, while stricter loan-forgiveness policies under the Trump administration may favor its student-loan refinancing segment.While SOFI’s valuation metrics suggest it is trading at a premium, this high valuation reflects its robust growth trajectory and strong market positioning. A 148% surge in the stock price over the past six months highlights investor confidence and the company’s ability to outperform both its industry and the broader market.Investors often pay a premium for companies like SOFI, which demonstrate scalable potential, industry leadership and consistent growth, making it a compelling buy even at elevated valuations.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Bank of America Corporation (BAC): Free Stock Analysis Report Wells Fargo & Company (WFC): Free Stock Analysis Report JPMorgan Chase & Co. (JPM): Free Stock Analysis Report SoFi Technologies, Inc. (SOFI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks