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SoFi Technologies Inc. (SOFI) is a publicly traded credit services business based in the US which employs around 4,400 staff. SoFi is listed on the NASDAQ and traded in US dollars. Its current price of $10.99 is 40.4% up on its price a month ago ($7.83).
All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.
Buying shares in just one company is generally considered a riskier bet than investing in a range of investments - AKA a "diversified portfolio". Experts generally recommend holding a mix of investments in specific assets and funds. Funds are ready-made portfolios of multiple companies' shares (potentially including SoFi), and the idea is that drops in the value of one constituent company's share price might be offset by rises in others.
SoFi is a major part of the NASDAQ, so it's included in many global funds and investment trusts, as well as tracker-style exchange traded funds (ETFs).
All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.
Valuing a stock is incredibly difficult, and any metric has to be viewed as part of a bigger picture of overall performance. However, analysts commonly use some key metrics to help gauge value. Check out the SoFi P/E ratio, PEG ratio and EBITDA.
SoFi's current share price divided by its per-share earnings (EPS) over a 12-month period gives a "trailing price/earnings ratio" of roughly 0x. In other words, SoFi's shares trade at around 0x recent earnings.
That's relatively high compared to, say, the trailing 12-month P/E ratio for the United States stock markets on average as of November 09, 2023 (20.44). The high P/E ratio could mean that investors are optimistic about the outlook for the shares or simply that they're over-valued.
However, SoFi's P/E ratio is best considered in relation to those of others within the industry or those of similar companies.
SoFi's "price/earnings-to-growth ratio" can be calculated by dividing its P/E ratio by its growth – to give None. Higher PEG ratios such as this can be interpreted as meaning the shares offer worse value given the current rate of growth.
The PEG ratio provides a broader view than just the P/E ratio, as it gives more insight into SoFi's future profitability. By accounting for growth, it could also help you if you're comparing the share prices of multiple high-growth companies.
However, it's sensible to consider SoFi's PEG ratio in relation to those of similar companies.
SoFi's EBITDA (earnings before interest, taxes, depreciation and amortisation) is a whopping $0 billion (£0 billion).
The EBITDA is a measure of SoFi's overall financial performance and is widely used to measure a its profitability.
To put that into context you can compare it against similar companies.
Digital lender SoFi completed its merger with special purpose acquisition corporation Social Capital Hedosophia Corporation V. SoFi's stock debuted on the Nasdaq under the ticker symbol "SOFI."
In its first day of trading, the stock jumped more than 12%.
All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.
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