By Sam Boughedda
SoFi Technologies Inc. (NASDAQ:SOFI) was maintained at Buy, with its price target raised to $9 from $6 per share at Mizuho on Wednesday.
The analysts stated that the "opacity surrounding SOFI's lending business is a major deterrent for tech investors who shy away from lenders and don't understand banks."
Mizuho believes it prevents SOFI, which is up almost 7% in Wednesday's session, from obtaining a higher multiple for being the quintessential next-gen, multi-product U.S. neo-bank for high FICO customers.
The firm updated its estimates for SoFi post fourth-quarter earnings. It raised its adjusted net revenue estimates for FY23 and FY24 to $1.987 billion and $2.601B from $1.967B and $2.587B, respectively. In addition, Mizuho raised its adjusted EBITDA for FY23 and FY24 to $273 million and $604M from $252M and $591M, respectively.
The price target raise was put down to "encouraging commentary from management on GAAP profitability by 4Q23 and continued resilience in a challenged environment."