Can SoFi Tech Mirror Amazon's AWS Success in Banking? Analyst Opines
Portfolio Pulse from Anusuya Lahiri
Deutsche Bank analyst Mark Devries initiated coverage on SoFi Technologies, Inc (SOFI) with a Hold rating and a price target of $11, citing limited visibility on tech platform growth. SoFi, an online bank with various personal finance solutions, trades more like a tech company despite revenues from consumer lending. The company is 45% owned by retail shareholders, contributing to volatility. Keys to 2024 include technology sales growth and profitability. SoFi's banking services are compared to Amazon's AWS, with the need for strong growth in their Technology platform. The analyst projected Q4 revenue and EPS slightly below consensus.
January 10, 2024 | 8:46 pm
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NEUTRAL IMPACT
SoFi's online banking services are compared to Amazon's AWS by Deutsche Bank analyst Mark Devries, suggesting that SoFi needs to return to strong growth in its Technology platform similar to AWS's success.
The mention of Amazon is more of a comparative benchmark for SoFi's potential in the banking technology space rather than a direct comment on Amazon's performance or outlook. Therefore, the impact on AMZN's stock is likely to be neutral in the short term.
CONFIDENCE 70
IMPORTANCE 50
RELEVANCE 50
NEUTRAL IMPACT
Deutsche Bank analyst Mark Devries initiated coverage on SoFi with a Hold rating and a price target of $11, focusing on the need for tech platform growth to support valuation. The company's performance in 2024 is expected to hinge on technology sales growth and profitability.
The Hold rating and price target suggest a neutral short-term impact on SOFI's stock price. The analyst's emphasis on the need for tech platform growth to support the current valuation could temper investor expectations, while the comparison to Amazon's AWS highlights potential but also sets a high bar for performance.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 100