Wells Fargo initiated coverage of SoFi Technologies with an Equal Weight rating and a $19 price target, citing strong growth prospects but cautioning that valuation and reliance on loan sales limit near-term upside.
The brokerage said SoFi’s long-term outlook is supported by continued member growth and rising product adoption. Members have expanded at a 43% compound annual rate since 2020, with the company targeting more than 30% revenue growth and roughly 38% to 42% EPS growth through 2028.
Wells Fargo highlighted SoFi’s integrated model spanning lending, financial services and technology as a key advantage, alongside its banking license and platform capabilities.
However, it flagged risks tied to the company’s loan platform business, which involves originating personal loans and selling them to third parties. While this has supported earnings growth, the brokerage said dependence on loan sales introduces uncertainty, particularly if credit market conditions weaken.
It estimates loan platform sales will contribute $0.33 and $0.42 to EPS in 2026 and 2027, respectively.
The firm said SoFi’s positioning as both a technology platform and a digital bank complicates valuation, with the stock trading closer to higher-growth fintech peers. It added that concerns around macro conditions and potential job disruption from artificial intelligence also weigh on sentiment.
Wells Fargo forecasts EPS of $0.62 in 2026, $0.81 in 2027 and $1.04 in 2028. It expects the lending segment to account for about 45% of revenue in 2026, followed by the loan platform business at 19% and the technology segment at 11%.
source https://www.investing.com/news/stock-market-news/wells-fargo-starts-sofi-technologies-at-equal-weight-on-valuation-loan-sale-risk-4571343
