Why SoFi Technologies Stock Zoomed Higher This Week
Shares of SoFi Technologies (NASDAQ: SOFI) popped 16.6% this week, according to data from S&P Global Market Intelligence. The financial technology upstart and consumer bank posted strong growth across the board in the third quarter, which investors applauded. However, the company remains unprofitable. This is likely why the stock is still off 70% from all-time highs, even after this week's rise in price.
In the third quarter, SoFi added 717 thousand new customers to its digital banking and financial services platform, hitting just under 7 million total members, growing 47% year over year. This led to deposits growing by $2.9 billion quarter over quarter for a total of $15.7 billion. As a consumer bank, growing deposits is the most important top-line number for SoFi. This is the fuel that allows it to offer loans and earn a net interest margin.
With rapidly growing deposits, SoFi has been able to steadily grow its loan book, especially in personal loans. Financially, this has helped it increase its net interest income, which hit $345 million in the quarter, up from $157 million a year ago. That is more than 100% growth in net interest income.
Source Fool.com
