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Summary
- Online personal finance platform SoFi Technologies Inc (NASDAQ:SOFI) saw its debutant stocks surge by about 12 per cent on Tuesday, June 1.
- SoFi’s stocks began trading on the Nasdaq platform following its reverse-merger with a SPAC.
- SoFi reportedly plans to offer initial public offering (IPO) shares in future, a move that will pit it against rival Robinhood Markets.
Online personal finance platform SoFi Technologies Inc (NASDAQ:SOFI) saw its debutant stocks surge by about 12 per cent on Tuesday, June 1.
SoFi’s stocks began trading on the Nasdaq platform following its merger with Social Capital Hedosophia Corp V, a special purpose acquisition company (SPAC) operated by investor Chamath Palihapitiya.
SPAC mergers are a way to go public where a shell company raises money to acquire a private firm, which then absorbs the shell corporation. Upon absorption, the newly public entity begins trading in place of the black check company with a new ticker.
Stocks of SPAC Social Capital Hedosophia Corp V closed at US$ 20.15 on Friday, May 28. Now trading under the new ticker of ‘SOFI’, the stocks jumped to closed at US$ 22.65 apiece on Tuesday.
SoFi has diversified its business strategy by expanding into payment and investing services. Its customers will now be able to trade equities and cryptocurrencies. SoFi CEO Anthony Noto said that its users can easily access the full suite of its financial services through the company's app.
SoFi Technologies (NASDAQ:SOFI) Vs Robinhood
SoFi reportedly plans to offer initial public offering (IPO) shares in future, a move that will pit it against rival Robinhood Markets. In the past, Mr Palihapitiya has lambasted Robinhood, a stock-trading platform, for 'meme stock' frenzies and even, at a point, suggested on Twitter that Robinhood users should delete the app and replace it with SoFi.
As for SoFi, Mr Noto has revealed the company’s plans to make IPOs accessible to its users.
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SoFi Technologies’ (NASDAQ:SOFI) Financials
In the first quarter of 2021, SoFi's adjusted net revenue was up by 151 per cent year-over-year (YoY) to US$ 216 million. In full-year guidance, the company claims that it will clock an adjusted net revenue of US$ 980 million.
In Q1 2021, the company posted a positive EBITDA for the third consecutive quarter and had an improvement of US$ 70 million YoY.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.
