Put Sofi in the banking category. You would realize that for SoFi's value to 3x, you would need an EPS around $3.9. with SoFi’s current outstanding share, that's earnings of 3.62 billion. given a top tier net margin of 20%, they would need to post a revenue of 18 billion. That’s a 10X revenue growth from current revenue standing. 5 years of execution at 50% YoY growth. That too given no increase in total outstanding share count
If you think a company that is growing at 40%+ should be valued the same as ones that are growing at low single digits or have negative growth, then of course the valuation makes no sense whatsoever. If you believe that SoFi should be valued as a legacy bank then you shouldn't invest in it.
I did a forward-looking valuation that attempts to capture the growth prospects of the company, different from simply valuing it on current earnings or assets as might be typical with legacy banks.
Anyway, I'm actually thinking of putting some money into SoFi stock, but not exactly because I believe in the company's fundamentals. Honestly, I have my doubts that SoFi can execute anywhere near that kind of topline and margin.
But here's the thing: I'm kind of betting on you instead. I can't put my finger on what's driving your strong belief in SoFi, but you seem to have a knack for rallying a big group of people behind your ideas. And who knows, maybe that alone could push the stock to triple its value anytime in the next five years!
My analysis is not going to move this stock at all. Institutions will move it based on fundamentals improving over time. That will move the price. My articles only get a couple thousand views, they aren't going to move the narrative or price at all.
Do a twitter sub! I will follow u there in a heart beat! Please don't do a discord! Substack has a great chat and messaging service.
I submitted an application for Twitter subscriptions months ago, but it's still waiting for review 🤷♂️
Subscribed!
I applied to refinance my parent plus loans so that instead of having 19 years left to pay..... I will have just 6 now that's good math
Put Sofi in the banking category. You would realize that for SoFi's value to 3x, you would need an EPS around $3.9. with SoFi’s current outstanding share, that's earnings of 3.62 billion. given a top tier net margin of 20%, they would need to post a revenue of 18 billion. That’s a 10X revenue growth from current revenue standing. 5 years of execution at 50% YoY growth. That too given no increase in total outstanding share count
If you think a company that is growing at 40%+ should be valued the same as ones that are growing at low single digits or have negative growth, then of course the valuation makes no sense whatsoever. If you believe that SoFi should be valued as a legacy bank then you shouldn't invest in it.
I did a forward-looking valuation that attempts to capture the growth prospects of the company, different from simply valuing it on current earnings or assets as might be typical with legacy banks.
Anyway, I'm actually thinking of putting some money into SoFi stock, but not exactly because I believe in the company's fundamentals. Honestly, I have my doubts that SoFi can execute anywhere near that kind of topline and margin.
But here's the thing: I'm kind of betting on you instead. I can't put my finger on what's driving your strong belief in SoFi, but you seem to have a knack for rallying a big group of people behind your ideas. And who knows, maybe that alone could push the stock to triple its value anytime in the next five years!
My analysis is not going to move this stock at all. Institutions will move it based on fundamentals improving over time. That will move the price. My articles only get a couple thousand views, they aren't going to move the narrative or price at all.