SoFi Technologies (NASDAQ: SOFI) stock tumbled about 4% in intraday trading Tuesday after Deutsche Bank cut its price target.
Mark DeVries, the analyst at Deutsche Bank, has revised the SoFi Technologies (SOFI) outlook, lowering the price target to $11.00 from the previous $12.00 while maintaining a Hold rating on the stock.
The analyst acknowledges the fundamental undervaluation of the company’s shares. However, he highlighted the prevailing volatility and negative sentiment surrounding the stock.
The analyst pointed out that the short-term performance of SoFi Technologies is unpredictable due to its inherent volatility. He highlighted the cautious market sentiment, which lacks favorable indicators for a significant upward movement in the share price. DeVries also noted the challenge of identifying catalysts that could drive the stock to align with the 18.5x price-to-earnings (P/E) ratio indicated by comparable companies in the sector.
Despite recognizing the potential value in SoFi Technologies’ shares, the analyst adopts a cautious stance in light of prevailing market conditions. Factors such as the stock’s volatility and prevailing sentiment contribute to the decision to uphold the Hold rating. DeVries believes that, given the current circumstances, the risk-reward profile for SoFi Technologies remains relatively balanced.
SoFi Technologies (NASDAQ: SOFI) Stock Reaction
Following the news, SOFI stock fell 4% to close at $6.78 on Tuesday. Its value has dropped by 10.55% this week. Trading activity has witnessed 77,052,477 (77.05 million) shares changing hands, well above the average daily volume of 52.42 million.
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