Plenty of commentators are talking about the resumption of required federal student loan repayments and how it will affect SoFi Technologies (NASDAQ:SOFI). Investors shouldn’t overestimate the impact of this, however. Moreover, one prominent analyst group sees SOFI stock as improperly valued and consequently downgraded it.

Previously, I recommended waiting for the SoFi Technologies share price to reach $6 before taking a position. That opportunity may come soon as the company is set to release its second-quarter 2023 earnings results on July 31.

There’s no way to know whether SOFI stock will rise or fall post-earnings. Either way, the stock’s risk-to-reward profile isn’t compelling enough to justify a long position, so pick your buy price and just be patient.

Student Loan News Won’t Be a Major Catalyst for SOFI Stock

Here’s what everybody and his uncle wants to talk about lately. The first required federal student loan repayments are anticipated to start in October. Furthermore, the interest on those student loans could start to accrue as early as Sept. 1.

On top of all that, the Supreme Court rejected President Joe Biden’s administration’s recent attempt to forgive millions of student loans. These news items seem to have precipitated a rally in SOFI stock. That’s because investors apparently expect SoFi Technologies to generate significant revenue from student loan refinancing.

What overeager investors might not be considering, though, is that many students probably wouldn’t have qualified for federal student loan forgiveness. Even SoFi Technologies CEO Anthony Noto seems to acknowledge this point:

“I do agree that it would likely not have a large impact on our members or potential members because their income in many cases would be higher [than the forgiveness plan allowed], and the amount of debt that they refinanced would be substantially greater than the $10,000 that was being offered.”

Hence, a factor that won’t have an outsized positive impact on SoFi Technologies, has probably already been priced into SOFI stock.

SoFi Technologies May Be Incorrectly Valued

Meanwhile, Wall Street isn’t particularly bullish about SoFi Technologies. Analysts expect the company to maintain its track record of negative earnings in 2023’s second quarter.

Also, out of 17 analysts, only seven of them have recently issued a “buy” or equivalent rating on SOFI stock. There are some SoFi Technologies bulls on Wall Street, I’ll admit. One example is the analyst team at Truist Securities, who reiterated their “buy” rating on the SoFi shares and called the company a “structural winner as the banking industry fragments.”

In contrast, Morgan Stanley analysts recently downgraded shares of SoFi Technologies from “equal weight” to “underweight.” This is based on their calculations, which seem to indicate that the stock isn’t properly valued.

Per Barron’s, the Morgan Stanley analysts figure that SOFI stock currently trades at “2.1x estimated 2024 tangible book value per share.” This valuation assumes an expectation that SoFi Technologies’ “bank business … will reach more than 30% return on average tangible common equity, or ROTCE.”

However, the Morgan Stanley analysts estimate that Technologies’ bank business will only “reach a 15% ROTCE by 2026.” That would justify a 1x price-to-book (P/B) value, as opposed to the aforementioned 2.1x book value that the Morgan Stanley analysts seem to suggest the market is already pricing in.

SOFI Stock Could Be Attractive Post-Earnings

So, here’s the bottom line. The resumption of required federal student loan repayments probably won’t provide a gigantic revenue boost to SoFi Technologies. In addition, analysts have differing but generally muted expectations for SoFi Technologies.

Along with all of that, investors should consider whether SoFi Technologies shares might be incorrectly valued. It’s a lot to think about, so here’s a strategy you can use.

Just wait until SoFi Technologies releases its upcoming quarterly results. If SOFI stock tanks, pick a buy price and wait patiently. Currently, my personal buy target is $6. If it gets there, then SoFi Technologies should have a more appropriate valuation and investors can buy the shares with confidence.

On the date of publication, David Moadel did not have (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.