Financial services company has seen its stock fall about 70% so far this year
SoFi Technologies Inc. shares were getting a major lift Wednesday after the company’s chief executive Anthony Noto disclosed a sizable purchase of the stock.
Noto bought about $5 million in SoFi SOFI, +6.09% shares from Dec. 9 to Dec. 13, according to a late Tuesday filing with the Securities and Exchange Commission.
Shares of SoFi were ahead more than 7% in Wednesday afternoon action.
The insider buying signals Noto’s confidence in the stock, which has plunged nearly 70% on the year, even taking into account Wednesday’s sharp rally. The neobanking company has been able to reap benefits from a banking charter obtained earlier this year, though the company has been hampered by the student-loan moratorium, which has affected demand for SoFi’s student-lending products. Demand for home loans has also come under pressure.
There has been a rout this year on growth-oriented fintech stocks, with names like Affirm Holdings Inc. AFRM, -4.07%, Coinbase Global Inc. COIN, +3.88% and Upstart Holdings Inc. UPST, -1.52% in the category that has seen major declines.
“[SoFi] is an example of a quality company that faces a difficult narrative,” Mizuho analyst Dan Dolev wrote in a note to clients earlier this week. “Although it is seen to be a quality company, the investor base is mixed between FinTech and traditional lending investors who appear to be undecided on [SoFi]’s business model and its valuation.”