SoFi Stock DOWN 40%! Should YOU BUY the DIP on SoFi Stock?

0:00 Profi stock is nearing oversold territory as the rsi index is showing a value nearing 33 on the daily chart sofi stock is down about 43 from its all-time high which was just north of 28 dollars per share and the only change is a general decline in interest from the reddit community is it time to make like ravenous sharks and feast on some discounted sofi stock before other investors bid up the price to new all-time highs maybe maybe not my name is blake and on

0:35 This episode of nine to five investing i'm gonna talk about sofi stock i'm gonna break it down from a fundamental analysis and a technical analysis perspective so that you can form your own opinion about whether sofi stock is a solid long-term investment sofi is a fintech company that recently went public through a spac merger deal sponsored by the one and only self-proclaimed king of spax champ polyhapatea sofi was founded in 2011 originally as a

1:07 Platform for servicing student loans sofi was started with a pretty smart long-term plan basically they wanted to capture students out of college that would likely be high income earners in the future and give them great customer service with that servicing of their student loans so they would actually come back to the sofi platform for other services later in life in a recent cnbc interview with the ceo of sofi anthony notto noto basically describes how the sofi

1:39 Product lineup is designed to get customers hooked up with more than one sofi product each product is meant to be built best in class on its own and after you use that product and we build trust with you you'll choose your second product from us and uniquely not only a one-stop shop we're making it so that each product works better when you use it with more than one of our products i am definitely intrigued by the idea of having a fintech company

2:04 That has all of the possible financial products and services on one platform because i generally believe that people like their finances to be centralized who wants to remember like 12 different logins for all these different financial products it sure would be good just to have it all in one place and i really do not think that it is much of a stretch for just for example a sofi customer to be introduced to the company through student loan refinancing for example and

2:32 Then as time goes on hey maybe they want a checking account maybe they want a savings account maybe they take out a credit card with sofi you can see how this could all add up to a lot of business for sofi over time my point is this if a customer is having a great experience with sofi for an initial product that introduces them to the platform why wouldn't they just think of sofi for their future financial needs if sofi offers the products i really

2:59 Don't think it's a stretch that some customers would just stick with the sofi platform for all their financial needs i want to play one more clip from that cnbc interview because i believe that the ceo does a great job of explaining the advantages of the sofi platform in a succinct way we're the only one-stop shop to do all of your financial services needs on one platform others talk about adding other products and diversifying but only sofi has done it so far is the

3:28 Only place you can use you can take out four different types of loans it's the only place you can invest on a mobile app in single stocks without commissions fractional share robo advisor accounts etfs five of our own etfs as well as cryptocurrency also a credit card in addition to that sofi money which allows you to pen uh spend pay and save any way that you want and so many people have talked about broadening the product and broadening the suite of products but

3:55 Only sofi has done it on one mobile platform the fact that sofi offers such a broad suite of financial products and services is definitely an aspect of this business that stands out to me as i weigh the pros and cons and decide whether sofi stock is a viable long-term investment in my personal opinion an economic recession or depression is not likely to put sofi out of business because they offer such a broad suite of products and services for example if there is an economic

4:27 Recession and the federal reserve decides to lower interest rates or if they just lower interest rates for political reasons uh sofi's personal loans and their mortgage refinancing business segments are going to do better another example is if the stock market crashes like it did in march of 2020 for a brief period of time then sofi invest is gonna do better because more people are interested in trading stocks you probably understand my general point

4:55 By now sofi is not dependent on a single business segment that is directly tied to how the economy is doing an interesting aspect of sofi from a fundamental analysis perspective is that they actually do have a 68 percent gross margin which is solid but they are still losing money despite these healthy margins i read part of the s1 securities registration statement that sofi filed with the sec and it explains why sofi loses money despite having these

5:26 Exceptional gross profit margins the main reason that sofi is losing money overall is because they are spending a lot of money on marketing and building out their platform with new products and services once the technology that powers the sofi platform is fully coated fully built out to support all the products and services that sofi would like to offer their customers then there will be a relatively small cost to maintain it once sofi decides to spend less money

5:55 Marketing and advertising their business to obtain new customers then this is another expense that will be completely eliminated potentially in the future my point here is that these operating costs are not necessarily going directly into the cost of the products and services that sofi is selling if management wanted to reduce these operating expenses then they could easily do so sofi is growing relatively consistently on their s1 registration statement

6:24 The company talks about how they have experienced accelerating member growth for seven consecutive quarters and they have over two million users on their platform i say relatively consistent with the growth just because sofi did have a year 2017 where they did 300 million dollars in revenue and then the following year 2018 they only did 123 million dollars in revenue i suspect that this was an outlier year because of crypto mania that occurred at the end of 2017 but regardless sofi

6:59 Did actually have a compound annual growth rate of about 5.3 percent from 2017 to 2020. so i think that that covers so far from a high level fundamental analysis perspective now let's quickly go over the technical analysis behind the sofi stock chart which is getting more interesting by the day it is no secret sofi stock is experiencing that typical post-merger sell-off that we have seen with a lot of different specs the only difference here is that instead of happening like the day of the merger the day the merger is complete it's happening like a month

7:37 After and there's actually a factor that i believe is making the sell-off way worse than it would have been otherwise this stock actually trended for a couple of weeks on reddit after the merger was completed so i think that there were a lot of people looking for that next gamestop or amc and uh they bought so far in the 20s as a result and now that sofa is in the mid teens there are a lot of people that are selling out of frustration because they bought

8:05 In the 20s just a couple of weeks ago so sentiment for the short term seems to be dead but once sentiment is dead once a stock is so beaten down that no one wants it that's ideally when you should be buying the stock in my opinion if we pull up sofi's daily chart we see a lot of high volume red days in the last couple of weeks there is a clear resistance line that has been drawn on this chart and blue unfortunately the bears have done a great job at keeping sofa

8:36 Below that resistance line so i actually do see something very positive in the stock chart and you might not necessarily love what i'm gonna say but there is very stable support at 14 per share so i'm not saying it gets down to 14 but it's not even that far away from 14 and if it were to approach that 14 level i believe it would make a pretty nice bounce off that level i actually personally do not have a position in sofi stock but if i was looking to start one that's

9:07 Where i'd be buying at that 14 level anyway that's about all i have today for sofi stock if you enjoyed this video please consider subscribing to the channel or maybe giving me a like it's free and it really helps out with that youtube algorithm so i greatly appreciate it thank you so much for taking a part of your day to be here for watching my video and i hope you have a very bullish day if you would like to watch a video about an e-commerce company

9:36 That has been trending on reddit for weeks then click the thumbnail on the left if you want to watch a video about why i believe hylion's hyper truck erx will beat the tesla semi then click the thumbnail on the right