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Online finance company SoFi Technologies (NASDAQ:SOFI) went public with great fanfare on June 1 when it merged with a blank check company Share capital Hedosophia Corp. V. As a result, IPOE shares disappeared and SOFI shares were publicly available for trading.
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It is one of the Special Purpose Acquisition Companies (SPAC) of Chamath Palihapitiya, and it is a well known name in this field.
InvestorPlace contributor Dana Blankenhorn called Palihapitiya a “billionaire in the mouth,” but I’ll be more charitable and call him the King of PSPC.
Either way, the action is tradable in June 2020 and I would say it’s worth considering. Indeed, this could represent an opportunity on the ground floor to invest in the future of fintech.
A brief history of SOFI Stock
Let’s go back in time. In October of last year, Social Capital Hedosophia Corp. V went public through an initial public offering (IPO).
The shell company “was targeting a tech company,†but investors didn’t know much more. As a result, IPOE stock has remained near the $ 10 level for some time.
Fast forward to January 7, 2021, when Social Capital Hedosophia Corp. V has announced its intention to merge with SoFi.
At that time, the financial markets were still in the grip of the SPAC madness. Therefore, traders were very excited about this particular reverse merger.
No doubt due to the big announcement, the IPOE / SOFI share price climbed to a 52-week high of $ 28.26 on February 1.
After that, however, the PSPC mania started to fade and reality began to set in.
When the merger deal was announced on January 7, it was due to be concluded by the end of the first quarter of 2021. This expectation was not met, however, and it appears some investors were disappointed.
By mid-April, the IPOE / SOFI stock price had already fallen to $ 16. But luckily that wasn’t the end of the story.
The enthusiasm is still there
SoFi, the name of the company, is the abbreviation for Social Finance. It’s a company with a bold, forward-thinking vision – and quite possibly, it’s a company that can easily survive the fall of the PSPC mania.
It’s even possible that the financial community is already looking beyond PSPC’s cycle of hype and disappointment and focusing on SoFi’s true value proposition.
As proof, let us note that the SOFI share closed up more than 12% when it debuted on June 1, 2021.
This is a sign, I believe, that there is still a lot of enthusiasm around this company, and the future of fintech in general.
CEO Anthony Noto said SoFi, which was founded in 2011, is “the one stop shop to meet all your financial services needs on one platformâ€.
Maybe you like Palihapitiya or maybe not. Either way, people can find common ground if they are open to the innovations of the banking experience that SoFi is trying to do.
Get paid faster
In the digital age, rapid access to funds is expected. However, it sometimes seems that traditional banks are not up to the task in this regard.
To address this issue, SoFi recently announced that its SoFi Money cash management product “will now offer members the option of receiving their paychecks by direct deposit (or other eligible direct deposits) up to two days prior to their payment.” regular payday â€.
With so many people still in financial difficulty as a result of the Covid-19 pandemic, SoFi is demonstrating responsiveness by allowing faster access to paychecks.
Additionally, SoFi recently launched a new program to help deal with the student loan debt crisis.
With this program, “borrowers have the unique opportunity to refinance, at historically low rates, all or part of their federal student loans without making monthly payments or interest until October 2021, through SoFi.”
Again, the company is teaching traditional banks how modern finance should be done.
Additionally, SoFi is wooing the Millennial and Gen Z cohorts, who control a lot of money these days.
SOFI action: the result
It is no longer necessary to consider the SOFI action as a PSPC action. You also don’t have to attach Palihapitiya’s name to it, if you don’t want to.
Instead, you can focus on what SoFi has to offer as a fintech barometer.
So far, it looks like the company is disrupting the banking system as we know it – and I personally agree with that.
At the time of publication, David Moadel had (directly or indirectly) no position in any of the stocks mentioned in this article. The opinions expressed in this article are those of the author, subject to the publication guidelines of InvestorPlace.com.
David Moadel provided compelling content – and sometimes crossed the line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga and (of course) InvestorPlace.com. He is also a chief analyst and market researcher for Portfolio Wealth Global and hosts the popular YouTube financial channel Looking at the Markets.
The publication Look Past the SPAC Mess and Consider the Value of SoFi Technologies appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
