SoFi (NASDAQ:SOFI) stock is in full focus today following yet another insider buy from CEO Anthony Noto. The CEO has now purchased SOFI stock on 23 separate occasions this year, demonstrating his bullishness for the company’s long-term prospects.
It has been a rough year for fintech companies and SoFi is no exception. With higher interest rates, customers are less incentivized to borrow money, whether it be for home, personal or student loans. High rates of inflation also haven’t helped customer sentiment. Mizuho analyst Dan Dolev explains:
“[SoFi] is an example of a quality company that faces a difficult narrative […] Although it is seen to be a quality company, the investor base is mixed between FinTech and traditional lending investors who appear to be undecided on [SoFi]’s business model and its valuation.”
At the time of this writing, SOFI stock trades at a price-to-sales (P/S) ratio of about 2.9 times, way below its average P/S ratio of 4.5 times. The company reached a peak P/S ratio of 9.3 times during November 2021.
Does SOFI stock have upside from current levels? Noto certainly thinks so.
Noto Buys More SOFI Stock, Oppenheimer Reiterates Price Target
On Dec. 15, Noto purchased 225,000 shares of SOFI stock at an average price of $4.59 per share. The next day, he purchased another 300,000 shares at an average price of $4.59. In total, the transaction was worth approximately $2.4 million. As of Dec. 16, Noto directly owns a total of 5.65 million shares. The transaction follows Noto’s purchase of 1.13 million shares between Dec. 9 and Dec. 13. Those 1.13 million shares were purchased at a value of about $5 million.
Noto has now purchased SOFI stock on 23 separate occasions this year. His Dec. 9 purchase was his first buy since June 16.
Earlier this week, Oppenheimer analyst Dominick Gabriele reiterated his price target of $7 per share for SOFI after meeting with Noto and CFO Chris Lapointe. Gabriele is highly optimistic about the company’s prospects once economic conditions improve. The analyst says management is “laser focused on producing 30% incremental adjusted EBITDA margins” and believes there is “significant room to grow liquidity/fund the bank.”
On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.