On Monday, SoFi Technologies Inc. (NASDAQ:SOFI) shares spiked more than 8% after announcing a strategic partnership with Pagaya Technologies. The financial lending platform wants to use Pagaya’s proprietary artificial intelligence infrastructure to expand its product offering.
Pagaya Technologies offers fintech companies, banks and other loan providers access to flexible loan products outside conventional credit models.
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Acknowledging the partnership, SoFi’s Chief Executive Officer Anthony Noto said:
We are excited to leverage SoFi’s sophisticated tech platform, strong brand, and consumer appeal to originate loans through Pagaya’s AI network.
SoFi shares are up nearly 44% over the last 30 days as they continue to recover from the 3-month decline endured between June and September.
Is SoFi a growth stock?
From an investment perspective, SoFi Technologies shares trade at a steep P/S ratio of about 19.51, making the stock less attractive to value investors.
However, the company is capturing a rapidly growing segment of the credit market, thus making it an exciting growth stock. In a recent statement whilst analysing the fintech industry, Mad Money host Jim Cramer told CNBC that SoFi and PayPal Inc. (NASDAQ:PYPL), were the standout picks for investors targeting ‘nouveau banks’.
And with analysts forecasting a SoFi EPS growth of about 86.50% next year, it could be time to buy the stock.
Technically the SOFI stock seems to be trading within an ascending channel formation in the intraday chart. As a result, the stock has rallied to overbought conditions, creating a perfect opportunity for a pullback.
However, given the company’s exciting growth prospects, the current bull run could continue for the foreseeable future.
Therefore, investors could target extended gains at about $22.70, or higher at $24.38, while $19.13 and $17.52 are support levels.
It may not be too late to buy SOFI
In summary, although SoFi Technologies shares are up nearly 44% since the 20th of September, the stock is still down more than 12% off its 52-week highs reached on the 8th of June.
Therefore, given the company’s exciting growth prospects, the current rally seems poised to continue for the foreseeable future.
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