This report shares updated data on all 40 positions in the Disciplined Growth Portfolio, and highlights notable risks and opportunities. Notably, we’re seeing some big cracks in the AI dam, and thereby new opportunities that are worth considering as you manage your own investments.
The Disciplined Growth Portfolio
For starters, here is the complete Disciplined Growth Portfolio.
fsdaadsf
asdf
SoFi is a millennial-focused financial services company that’s up more than 200% in the last year. And the gains are not just because of social media hype, but also due to SoFi’s impressive fundamental growth (as the company capitalizes on millennials’ growing distrust of traditional finance). This report reviews SoFi’s powerful “product differentiation” strategy, growth opportunities (particularly its latest foray into cryptocurrency and private equity), current valuation and risks, and then concludes with my strong opinion on investing.
SoFi Technologies (SOFI) shares are unsurprisingly up significantly post-election considering the new White House and Congress will be less friendly to the idea of student loan forgiveness (SoFi private loans didn’t qualify), but also as the company announced record beating quarterly performance at the end of October.
The Supreme Court has ruled, and the Biden Administration is largely abandoning its fight to permanently cancel student loan debt for millions of Americans (until 2024, an election year, when the new plan will be touted). So what does this mean for SoFi, an already fast-growing fintech that expects its revenue to accelerate as federal student loan payments are now set to resume? In this report, we review how SoFi has been growing its business during the student loan pause, how it will benefit going forward, the company’s recent financial performance, valuation and risks. We conclude with our strong opinion on investing in SoFi.
The fintech company we review in this report just announced quarterly results and they were impressive. Specifically, the company reported record revenue, increasing profitability and robust member and product growth. In this report, we highlight a few strong reasons why you might want to consider investing in this opportunity, including its strong financial performance, diversified revenue streams, strategic growth initiatives, large market opportunity and its valuation. We are currently long the shares in our Blue Harbinger Disciplined Growth Portfolio.
Quick Note: Anthony Noto (SOFI CEO): In the ever-evolving landscape of the financial industry, a great leader can be the difference between stagnation and growth. Anthony Noto, the CEO of SoFi (Social Finance, Inc.), stands out as a paragon of effective leadership and innovation. With a remarkable educational background, extensive work experience, and a series of impressive successes, Noto has proven himself as a visionary leader who is shaping the future of the financial world.
SoFi recently sued the Biden Administration, arguing there is no legal authority to continue student loan forbearance. However, within the next few weeks, the Supreme Court is widely expected to rule against the Biden Administration’s student loan forgiveness program, which will likely end forbearance within 60 days. In this report, we review SoFi’s business and the effects of fear (from the student loan situation, combined with recent banking sector distress caused by rapidly rising interest rates) on the company’s current valuation. After discussing specific risks in more detail, we conclude with our strong opinion on investing in SoFi.
SoFi Technologies (SOFI) is a financial services company, focused mainly on lending (see Income Statement operating segments below). And the shares are currently getting pummeled for one main reason: Fear. Specifically, fear of the upcoming Supreme Court ruling on student loan forgiveness and fear of banks defaulting (i.e. contagion to the financial system from the recent run on Silicon Valley Bank (SIVB)). In this note, we quickly review SOFI’s business and valuation, and then conclude with our strong opinion on investing (i.e. is the recent sell off an opportunity or a warning).
Shares of this fintech +13% today after beating EPS expect and raising guidance. Some argue despite strength across all 3 segments (lending, tech platform, fin services) EPS is still negative (-$0.09 in Q3), but there is a clear path to profitability. The company’s new bank charter is providing flexibility against the challenging macro backdrop and the student loan business seems less handicapped as competing fed loan forgiveness on hold (at least for now). Rapid revenue growth (+51% y/y), very large market opportunity.
