- SoFi stock price has plunged sharply in the past few months.
- The company came under a short-seller attack earlier this year.
- Technical analysis points to more downside if it loses the key support at $14.9.
SoFi stock price has come under pressure this year and is now hovering near its lowest level since June 2025. It slumped to $16.4, down sharply from last year’s high of $32.7. This sell-off continued after the company published a weak financial report last week. So, is this sell-off justified, or will the stock keep falling?
Why SoFi Stock Has Crashed
SoFi, a top neobank, has crashed this year for two main reasons. The first main one is that Muddy Waters, a top short seller, published a short report alleging that the company concealed over $300 million in debt, misstated loan charge-off rates, and engaged in circular investment schemes.
SoFi has denied all these claims. Still, in most cases, investors tend to dump shares whenever a short-seller report is issued. In some instances, as we saw with Nikola and Enron, there is usually some truth in these reports.
The sell-off followed the company’s financial results announcement. While its top-line numbers were strong, its technology business reported a big decline as one client withdrew assets.
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Also, investors are concerned about its valuation, as its forward price-to-earnings ratio has risen to 28, well above the sector median of 10. The company justifies its valuation by citing its rule-of-40 multiple, which has remained above 40 for 4 consecutive years. This rule looks at a company’s revenue growth and its margins.
The most recent numbers showed that its members jumped by over 1.1 million users in the first quarter, bringing the total to over 14.7 million. This performance makes it one of the fastest-growing companies in the industry. Its revenue jumped by 41% YoY to $1.1 billion, while the adjusted EBITDA soared to $340 million.
The company’s growth is largely driven by its diversified business model, which provides a range of services, including investing and lending. It has re-entered the crypto industry and even launched its SoFiUSD stablecoin. It also launched the Big Business Banking solution, expanding its service to enterprise customers.
SoFi Share Price Technical Analysis
The weekly timeframe chart shows that the SoFi share price has crashed in the past few months. It has slumped and is now hovering slightly above the 61.8% Fibonacci Retracement level. This is an important level, as many reversals begin here.
The stock is about to form a double bottom, a common bullish reversal pattern in technical analysis. Therefore, while the stock will likely continue falling in the near term, a rebound cannot be ruled out. A break below the double bottom at $14.9 will invalidate the bullish outlook and signal further downside.
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