SoFi Technologies, Inc. (NASDAQ:SOFI) experienced a volatile session on Wednesday, briefly climbing past the key $18 median Wall Street target before retreating. The stock touched an intraday high of $18.43 following the announcement of its Composer AI investing platform, but closed at $17.31, up a modest 0.12% on the day. Trading volume surged to 119.99 million shares, 74% above the 65-day average of 69.04 million, according to data from WSJ and FactSet.
The close outperformed the S&P 500's slight 0.10% decline and the financial sector's 1.09% drop. In pre-market activity on Thursday, SoFi shares were trading at $17.52, up 1.21% ahead of the Nasdaq open.
Analyst Consensus and Price Targets
The $18 level remains a critical psychological and technical benchmark for the stock. FactSet data shows the median analyst target at $18, with an average target of $20.75. The consensus rating is Hold, comprising 8 Buy ratings, 13 Holds, 1 Underweight, and 4 Sells. This mixed sentiment reflects ongoing caution despite the AI product launch.
Earnings Estimates Unchanged
Despite the buzz surrounding the Composer deal, Wall Street's earnings estimates for SoFi have remained stagnant. FactSet reports that the 2026 EPS estimate stands at $0.60, unchanged from a month ago and just one cent below the figure from three months prior. At Wednesday's close, SoFi trades at approximately 29 times its projected 2026 earnings, a valuation that some analysts view as elevated given the lack of upward estimate revisions.
The Composer AI Deal
On June 23, SoFi announced the acquisition of Composer Securities LLC and the launch of Composer by SoFi, an AI-driven investing platform. The product allows users to create automated investing strategies using plain language and provides access to over 2,000 community-built strategies. Financial terms of the deal were not disclosed, according to Reuters.
CEO Anthony Noto explained to Reuters that investors can begin using the platform in “plain English,” emphasizing that “members are staying engaged through volatility and looking for opportunities rather than retreating from the market.”
Invest Product Growth and Revenue Impact
SoFi Invest, the company's brokerage and investing arm, had 3.67 million products as of March 31, up 37% year-over-year. However, this remains significantly smaller than SoFi's core banking products: SoFi Money and Relay each had approximately 7.32 million products. The Composer platform is expected to help close this gap.
In the first quarter, SoFi's brokerage fee revenue more than doubled, while total Financial Services revenue rose 41% to $428.5 million. Total fee-based revenue increased 23% to $386.8 million. Investors will be watching for any measurable contribution from Composer in these segments when second-quarter results are reported.
Core Lending Business Remains Key
Despite the AI pivot, SoFi's core business remains lending. First-quarter originations surged 68% to $12.18 billion, with personal loans accounting for $8.34 billion. Net interest income climbed 39% to $693.0 million. The company's exposure to credit demand and funding costs remains a key risk, even with new AI tools.
One overhang for the stock is the unchanged full-year guidance. William Blair analyst Andrew Jeffrey noted that SoFi “uncharacteristically did not flow through first-quarter revenue and EBITDA upside” after its Q1 report, which led to a 12% share decline on that day, according to Reuters.
Competitive Landscape
SoFi is not alone in leveraging AI for trading. Reuters reported last month that Robinhood Markets, Inc. (NASDAQ:HOOD) plans to allow users to open dedicated trading accounts and use AI agents to execute trades on their behalf, intensifying competition in the AI-driven investing space.
SoFi is scheduled to report second-quarter results on August 4. Investors will be closely monitoring any changes in Invest product counts or brokerage fee revenue that could signal early traction for the Composer platform.
