The stock market was having a generally strong day on Tuesday in its first day of trading since the presidential inauguration. As of 2:30 p.m. ET, the S&P 500 (SNPINDEX: ^GSPC) was higher by about three-fourths of a percentage point.
SoFi (NASDAQ: SOFI) was a major standout. Not only was the fintech stock higher by nearly 10% for the day, but it reached a new 52-week high, continuing the strong momentum it has shown since mid-2024.
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There isn’t any company-specific news driving SoFi higher on Tuesday. However, there are still several factors that could be contributing to the move.
For one thing, the new Trump administration generally takes a lower-regulation approach, which could be a big tailwind for smaller banks like SoFi over the next few years. On Day 1 of his presidency (Monday), Trump signed an executive order freezing any new regulations, so this could be a positive sign for investors. It’s also worth noting that many other bank stocks — especially those that primarily operate online — were handily outperforming the market as well on Tuesday.
There are also some recent news items that have given the stock momentum. For example, SoFi reported a $525 million personal loan securitization deal with PGIM Fixed Income late last week, showing excellent demand from investors.
We’ll get a look at SoFi’s year-end 2024 earnings on Jan. 27, and if the fintech innovator keeps its momentum alive and delivers stronger-than-expected results, there could be more upsides ahead. In the third quarter, SoFi grew its member base by 35%, added 1.1 million new financial products, and reported impressive profitability.
For the fourth quarter, analysts are expecting to see earnings per share of $0.04, which would be flat year over year, and about $679 million in revenue, which would be about 14% more than the same period the prior year. If SoFi can beat that, there could be more short-term upsides ahead.
On a more long-term note, it will be important to see what CEO Anthony Noto and his team say about profitability forecasts for 2025 and beyond, as well as any new products and services that might be in development.
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Matt Frankel has positions in SoFi Technologies. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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