SoFi's (SOFI 4.17%) stock price dropped over 10% after reporting its second-quarter 2021 earnings on Aug. 13. In today's video I look at SoFi's most recent earnings and share some of the green flags and yellow flags investors should watch for. Here are some highlights from the video.
- SoFi announced 74% year-over-year (YoY) adjusted revenue growth when it reported its second-quarter 2021 earnings on Aug. 13. The adjusted revenue growth was driven by a 47% YoY adjusted revenue growth in its lending segment, which provides roughly 72% of total adjusted revenue.
- One of the most impactful yellow flags reported during these earnings was the recorded net loss of $165 million compared to a net income of $7.8 million a year ago. One of the main reasons for this vast gap is that SoFi had a tax benefit of roughly $100 million a year ago, which allowed the company to report a net income instead of a net loss.
- SoFi is still expected to grow at impressive levels for the entire year of 2021. The company's updated guidance expects 58% YoY adjusted net revenue growth and the first full fiscal year to have positive adjusted earnings before interest, taxes, depreciation, and amortization. Guidance would have increased, but the recent extension of federal student loan payments impacted future revenue growth.
Click the video below for my full thoughts and analysis.
*Stock prices used were the premarket prices of Aug. 13, 2021. The video was published on Aug. 13, 2021.
