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Buy SOFI Stock for Strong Growth as It Nears a Technical Floor

InvestorPlace logo InvestorPlace 7/8/2021 Luke Lango and the InvestorPlace Research Staff
a close up of a sign: the Social Finance (SoFi) logo is displayed on a smartphone. © Source: rafapress / Shutterstock.com the Social Finance (SoFi) logo is displayed on a smartphone.

SoFi (NASDAQ:SOFI) hasn’t had a great month. Over the past 30 days, SOFI stock has tumbled about 30%. But that’s no reason to cower. In fact, we think SoFi’s dip is a great opportunity to buy into SOFI stock on the cheap.

a close up of a phone: the Social Finance (SoFi) logo is displayed on a smartphone. © Provided by InvestorPlace the Social Finance (SoFi) logo is displayed on a smartphone.

We attribute the selloff to a flurry of fintech initial public offerings (IPOs) drawing some amount of interest and money away from SOFI.

But selling for this reason doesn’t make sense. SoFi isn’t just another fintech company trying to create a digital bank to replace Wells Fargo (NYSE:WFC) and Bank of America (NYSE:BAC), it’s the best fintech company. And they’ve created the best digital bank to date that we believe will eventually replace major banks.

And their 1.8 million customers, up 160% from the start of 2019, represent just 0.4% of the roughly 500 million bank accounts in the United States. Wells Fargo and Bank of America have market caps of $170 billion and $345 billion, respectively. With a market cap of just $20 billion, there’s a lot of room for growth here with SoFi.

In other words, fintech companies are popping up at an increasing rate, but SoFi is ultimately the cream of the crop.

They have the most talented management team, the most used product, and the most comprehensive set of fintech tools. Consequently, they also have the most potential to disrupt traditional banking.

The Bottom Line on SOFI Stock

Near-term weakness — resulting from an expanding fintech space — is creating a temporary buying opportunity in this long-term winner.

We are also bullish on the fact that SOFI stock appears to be approaching a technical bottom. SoFi stock was a bargain before at around $20, but now it’s a steal.

The stock has show strong technical support around the $15 level for several months.

We’re currently just a dollar or so above that level, so the downside risk seems limited at current levels. The upside potential, on the other hand, is enormous.

SOFI stock has an amazing risk-reward profile, so we believe you should buy.

SoFi is but one of my top picks to buy long-term. And, yes, SOFI stock will score investors big returns. However, it’s far from the only hypergrowth stock on my radar.

In fact, in my free e-letter, Hypergrowth Investing, I cover emerging megatrends and high-risk, high-reward stock picks each and every day. By becoming a subscriber, you’ll never have to pay a dime and will always get high-quality information on a number of market themes and picks that could make you a ton of money over the near- to long-term.

And by subscribing today, you’ll also get my latest research report, 11 EV Stocks to Buy for 2021.

Interested? Just click here and you’re well on your way to getting your first issue directly in your inbox. Just look for it each day at 7:30 a.m. Eastern.

Happy investing.

On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.

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