SoFi Tops Forbes' Best Banks List — and the Stock Is Still Cheap

A short report recently targeted SoFi, raising questions about credit quality and growth sustainability. The stock wobbled. The short thesis focused almost exclusively on the lending book — student loan refinancing, personal loans, home loans. It treated SoFi as a specialty lender with above-average risk.

That framing ignores about half the business. SoFi's technology platform — Galileo and Technisys — processes transactions and provides banking infrastructure for other fintechs and financial institutions. This is a B2B software business embedded inside what looks like a consumer bank. It's the razor-and-blade model applied to financial services: the consumer products acquire members, and the technology platform monetises the infrastructure.

Value the lending business conservatively. SoFi's loan book carries risk — consumer credit always does — and the short report raised legitimate questions about loss provisions in a slowing economy. Grant the bears a 1.2x book value for the lending segment. That gets you roughly $8-10 billion.

Now value Galileo and Technisys. These platforms process over 150 million accounts. They're growing at 30%+ annually. Comparable B2B fintech infrastructure companies — Marqeta, Plaid's implied valuation, even FIS's digital segment — trade at 8-15x revenue. At the low end, SoFi's tech platform is worth $6-8 billion. At a more reasonable 10x, it's $10-12 billion.

Add the two together: $16-22 billion. The current market cap is $20.7 billion. At the midpoint of our range, the stock is roughly fairly valued. But that assigns zero value to the financial services membership base of over 10 million members, the brokerage platform, the credit card, or the brand that Forbes just crowned number one.

At 8x 2027 estimated revenue of $7 billion — still a discount to fintech peers — you get a $56 billion market cap, or roughly $30 per share. The stock sits at $16. Something has to give.

Profit margin sits at 13.4% on a TTM basis, with operating margins at 18.2%. For a company that was deeply unprofitable 18 months ago, this is a remarkable trajectory. The operating leverage inherent in digital banking — no branches, no tellers, automated underwriting — means that each incremental dollar of revenue drops through at a higher rate than the last.

The bear argument that profitability is unsustainable because growth will slow misses the point. Even if revenue growth decelerates from 83% to 30-40% in 2026 and 2027, the margin expansion from operating leverage alone could double EPS. The 28.6x forward PE compresses to 14-16x on 2027 earnings. For a bank growing revenue 30%, that's a steal.

By comparison, JPMorgan trades at 13x forward earnings growing revenue at 5%. SoFi at 14-16x growing at 30% represents a much better deal on a PEG basis.