NEW YORK: Shares of SoFi Technologies Inc rose by more than 22 per cent on Monday, hitting highest level in more than a year, after the financial services provider reported second quarter results that beat analyst expectations.
SoFi's total net revenue rose 37 per cent to US$498 million, driven by strong growth in personal loan originations that allowed its net interest income (NII) to more than double to US$291.1 million in the three months ending in June, the company said on Monday.
That result exceeded the average analyst estimate of US$476.2 million and US$261.3 million for SoFi's revenue and NII, according to Refinitiv data.
SoFi's shares rose as high as US$11.70, the highest level since March last year, before closing at US$11.45 on Monday - a nearly 20 per cent gain from the previous session. The stock, which has risen nearly 150 per cent so far this year, was the second most traded stock among retail investors as of 10.30am ET, JPMorgan data showed.
San Francisco-based SoFi, which posted a net loss of US$47.5 million, said it expected to report a profit for the first time in the fourth quarter of this year. The company's total deposits grew 26 per cent to 12.7 billion in the quarter, powered by a 44 per cent growth in its customers to more than 6.2 million.
"(Second quarter) results beat expectations and were largely positive with continued rapid member and deposit growth," Jefferies analysts, led by John Hecht, said in an investor note.
"We highlight that results were more from net interest income and less from fair value marks relative to our forecast, which represents recurring revenues," the analysts added.
Jefferies assigned a "buy" rating to SoFi's stock, with a target price of US$11.50 compared with the median target of US$8 from 18 Wall Street analysts covering the company that Refinitiv data showed.