Shares of SoFi Technologies Inc. (NASDAQ:SOFI) are down roughly 5% in premarket trading Thursday after the company lowered its full-year net revenue guidance and announced board resignations.
For the full fiscal year, SoFi expects adjusted net revenue of $1.47 billion, compared to its previous guidance of $1.57 billion and consensus estimates of $1.53 billion. The personal finance company expects FY adjusted EBITDA of $100 million, down from the previous forecast of $180 million and missing the analyst expectations of $176.8 million.
SoFi expects Q1 adjusted net revenue in the range of $280 million to $285 million, short of the consensus projection of $287.8 million. It expects adjusted EBITDA from $0 to $5 million in the first quarter, compared to analysts expectations of $2.79 million.
The guidance cut comes after U.S. President Joe Biden's administration ordered the extension of the federal student loan payment moratorium from May 1 until August 31.
Separately, the fintech company announced that three members of its Board of Directors will be stepping down, including Clay Wilkes (the Founder of Galileo Financial Technologies), as well as SoftBank's Michel Combes and Carlos Medeiros.
Mizuho analyst Dan Dolev cut the price target to $14.00 per share (from $17.00) on Buy-rated SoFi stock following changes to the guidance and a less hospitable environment for FinTech multiples in general.
"The specter of an extension has been weighing on the stock for weeks. Many investors believe the guide-down includes additional weak spots; however, our analysis shows the drag on the P&L is only due to extending the moratorium. We see no incremental weakness. With the three board members stepping down, including Galileo's founder, we see this as more of an optics issue than an indication of a problem.. Our long-term views of SOFI remain unchanged. Buy," Dolev said in a client note.
Morgan Stanley analyst Betsy Graseck is more cautious than Dolev as she pays special attention to boardroom changes. Graseck also lowered estimates to in-line with the new guidance.
"SoftBank is the top shareholder of SOFI. This announcement is likely to act as an additional overhang on the stock in the near-term," Graseck said in a client note.
Sofi stock price closed at $8.75 yesterday.
By Senad Karaahmetovic