Granted, this proposal, which, after being subject to public comment, is expected to be implemented later this year, would not be a crushing blow to SoFi Technology, and would at worst have a modest effect. dowmarkets Alongside this possibly-emerging headwind, other issues with SoFi shares remain at hand. Soft landing or hard landing, the current downturn could also still be a negative for results in the coming quarters.
It could be just well enough to push SOFI back down to penny stock levels (under $5 per share). However, with the student loan repayment pause, in place since the onset of Covid-19 in 2020, this line of business has been largely on pause as well. Student borrowers haven’t had to make payments for nearly three years.
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Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held any positions in the securities mentioned in this article. Looking on a longer time horizon, SOFI continues to have questionable upside potential. Today’s valuation seems to account for future growth, and then some. Already an unfavorable opportunity, with a recent development that could make it even less appealing, skipping out on SOFI stock remains the best move.
- Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services.
- Already an unfavorable opportunity, with a recent development that could make it even less appealing, skipping out on SOFI stock remains the best move.
- However, in this episode, Jamie explains why he isn’t ready to add SoFi stock to his portfolio just yet, and he outlines two things that would have to happen before he becomes an investor.
- Granted, this proposal, which, after being subject to public comment, is expected to be implemented later this year, would not be a crushing blow to SoFi Technology, and would at worst have a modest effect.
- Looking on a longer time horizon, SOFI continues to have questionable upside potential.
In fact, rather than poised to experience another big liftoff in price, shares could be at risk of selling off once again later this year. Even as the “student loan saga” is likely to resolve by late summer, this may fail to spark re-accelerated growth for this fintech firm. But while this implies student hantec markets minimum deposit loan refinancing will pick up starting in September, this much-awaited catalyst for SOFI stock may fail to deliver because there’s a new student loan repayment proposal in the works. If implemented, this repayment plan may give borrowers even less incentive to refinance loans in the private market.
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Of course, this “pause,” after several delays, will end later this year. If an upcoming Supreme Court case regarding the Biden Administration’s authority to implement partial student loan forgiveness is resolved quickly, student loan repayments will resume 60 days later. If the case remains unresolved on June 30, repayments will begin on Aug 29. As I have argued teletrade metatrader 4 previously, there is a strong chance SoFi Technologies ultimately is valued by the stock market more like a bank stock than as a fintech stock. With this, the company may have to handily beat current long-term earnings forecasts in order to justify a material move higher. More importantly, it may have an impact on the company’s aforementioned cross-selling plans.
The economy may experience a soft landing rather than a hard landing. However, I wouldn’t assume all of this points to a big recovery for SOFI between now and the end of 2023. With market optimism on the rise, SoFi Technologies shares continue to inch higher. However, in this episode, Jamie explains why he isn’t ready to add SoFi stock to his portfolio just yet, and he outlines two things that would have to happen before he becomes an investor.
Department of Education announced a proposal to “transform” the current income-driven repayment programs offered on federally-backed student loans. The end of the “student loan saga” may fail to re-accelerate growth, and the resultant disappointment could send shares back to penny stock levels. If you’ve been following SoFi Technologies, you undoubtedly know that its fortunes are heavily tied to the situation with federally-backed student loans. This company has since become a diversified digital-first financial institution, but SOFI started off as a third-party provider of student loan refinancing. Let’s dive in, and see why the latest news regarding student loan repayments could have a negative impact on the stock. Still, with so much riding on SoFi’s growth reaccelerating starting in late 2023, a modest negative impact may still result in the company falling short of future expectations.