After a drop of 35% from peak to trough, SoFi Technologies’ stock (SOFI), is trying to recover. However, as the market becomes more against all things growing, SoFi Technologies (SOFI) stock could find it difficult to reach a bottom this year.

Analysts are not in a hurry to lower their prices targets or downgrade ratings, despite recent selling pressure. SOFI stock, therefore, is one of the more upside-oriented tech names.

While SOFI stock may be in decline, I remain bullish about the name because of its potential to disrupt the financial services industry long term.

Millenials: SoFi Clicking

Technology is needed to transform the financial services sector.

SoFi offers digital-first services that are more than just saving money. They can also make it simpler and easier to manage your financial future.

SoFi is an easy-to-use and efficient option for young consumers who want to stay in control of their mortgages, student loans and investments.

In the next few years, many banks that have failed to serve younger and less wealthy (but tech-savvy) customers will be forced to catch up.

The millennial generation is becoming more wealthy and demanding greater service from financial institutions. While many banks offer digital services, not all can compete with SoFi.

There are risks

SoFi might be subject to increasing pressure from incumbents as the industry shifts from digital to conventional banking.

Banks that are likely to be affected by the disruption of SoFi and others won’t sit back watching them lose a larger slice.

Large banks have the resources to invent and acquire digital assets. SoFi could be losing profitability due to this competition. SoFi will continue to invest to keep its edge.

SoFi is not only up against financial firms. There are many technology companies that want to be successful in fintech.

However, it could be difficult to get into banking with a tech company. Alphabet’s “Plex” bank service was shut down by the company in less than one year. Other tech leaders may underestimate the SoFi moat.

It will be difficult to catch up with SoFi, given its growing brand loyalty among young people and the rapid pace at which it innovates, particularly as digital offerings increase over time.

Wall Street Take

TipRanks analysts rate SOFI stock as Strong Buy. Four Buy recommendations are included out of five, with one Hold recommendation.

The average SoFi price target is $24.50. The price targets for analysts range from $16.50 to $30, depending on the company.

The Bottom Line

SoFi helped many young people get rid of their heavy student debts. These millennials are likely to stick with SoFi for their mortgage, business loans, and investing needs.

SoFi caters to the young generation of millennials and is therefore a great way to be part of what’s next in the once rigid financial sector.

Disclosure: Joey Frenette is not a shareholder in any of the mentioned companies at publication.

Disclaimer: Information in this article does not necessarily reflect those of TipRanks. TipRanks cannot guarantee the reliability, completeness or accuracy of any information. The article does not constitute a solicitation or recommendation to buy or sell securities. The article does not provide legal, financial, investment, or professional advice. It also doesn’t take into consideration the individual needs or requirements. Neither is the information contained in it a complete or comprehensive statement about the subject or issues discussed. TipRanks, its affiliates, disclaim any liability or responsibility in relation to the article’s content. You are responsible for your actions based upon the articles. TipRanks and its affiliates do not endorse or recommend this link. The past performance of TipRanks or its affiliates is not an indication of future prices, results, or performances.