SoFi Technologies (NASDAQ: SOFI) stock jumped over 3% on Friday after Mizuho reaffirmed a bullish outlook.
The Mizuho analysts are optimistic about SoFi Technologies (SOFI), holding onto their Buy rating and $12 per share price target on the stock, as stated in a client note on Friday.
The firm is confident that the company’s new $750 million convertible note offering, along with a $600 million equity exchange announced earlier this week, has the potential to turn skeptics into supporters despite initial investor concerns about stock dilution.
Mizuho analysts express that understanding the numerous advantages of the two deals will likely lead to a rise in the stock.
The analysts predict that the equity exchange deal could increase the company’s tangible book value per share by 10% and enhance capital ratios by over 200bps.
They noted that all this would occur without causing any significant EPS dilution.
The Mizuho analysts commented,
“The new convert helps save over $60mn in annual interest expense per year, paying back the est. ~$ $90mn in capped call costs in 1.5 years.”
SoFi Technologies (NASDAQ: SOFI) Stock Price Action
SOFI stock rose 3.21% to close at $7.71 on Friday. The traders had exchanged hands with 76,291,338 (76.29 million) shares compared to the average daily trading volume of 55.95 million.
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