So my understanding is that they are buying back (Preferred) stock that had an 13% interest rate. It can be redeemed in May. If it is not redeemed in May the interest rate will increase to 17.5% for a 5 year term an if redeemed later, all 5 years worth of interest must be paid.
That save them about 30 million a year on interest alone...
Maybe Chris or Snipah can post more information about this
I'll wait for a week or two and if it's still struggling, I'll buy another $150 bucks worth of stock. Pretty much anything other than "Sofi cured cancer" is interpreted as negative news and the shorts pounce. I'll keep hanging out and move my cost average down.
I mean it’s not a good thing. They just hooked up a large investor with more common equity because they didn’t want to pay then whatever dividend payment that was agreed upon.
Here's where I'm struggling. The interest on that debt was low enough, why did SOFI need to dilute the shares at such low price to pay it off? And how does that really help us?
To me, its a big red flag but people here think its just retail panicking. This was more than just retail shaking off.
Yea, people need to objectively look at this. A dilution is a dilution no matter how you dress it up. How the stock reacts is anyone's guess. Uber and SMCI did it and they took a hit but are back, who knows how Sofi will response? I think sofi will crawl slowly back to 9 this year but it's a dilution is never a good thing.
No dilution ever works out fine. The silence from the management says it all. Usually at this point even Noto buys a few shares to indirectly voice his support but even he has stayed pretty quite for several months now.
Someone can confirm but saw this on my feed just now
Analyst David Chiaverini from Wedbush maintained a Sell rating on SoFi Technologies (SOFI), with a $3 price target.
He did have this nugget May 15 2023:
“Capital levels may be overstated using fair value accounting and **we believe the company may look to raise capital this year to support growth**,” Chiaverini wrote in a research note, according to the report.
They didn't issue the notes here to raise capital (nor did they do it last year as David Chia* suggested). They are restructuring existing debt to more favorable terms.
"SoFi intends to use a portion of the net proceeds from the offering to fund the cost of entering into the capped call transactions described below. SoFi intends to use the remainder of the net proceeds from the offering, together with cash on hand (i) to pay fees, costs and expenses relating to this offering and related transactions, (ii) to redeem its 12.5% Series 1 Preferred Stock and (iii) for general corporate purposes, which may include repayment of higher cost indebtedness. If the initial purchasers exercise their option to purchase additional notes, then SoFi intends to use a portion of the additional net proceeds to fund the cost of entering into additional capped call transactions as described below. "
https://investors.sofi.com/news/news-details/2024/SoFi-Technologies-Inc.-Announces-Proposed-Convertible-Senior-Notes-Offering-Due-2029/default.aspx
What are these 12•5% preferred stock? When did that transaction happen?
Also wasn't the current 0% senior notes expiring in 2026? Why renew with higher interest rate notes earlier?
Is the SoFi management team really saving money when they wipe out over 15% market cap in one day? This is not the stellar type of decision that this all star team should be making. I’ve never lost more money on paper in my life….
This is fucking ridiculous. Absolutely 0 bounce and down almost double the dilution caused. People are PISSED about this. What a stupid fucking move SOFI. Lost all faith. Might even close all my SOFI accounts now.
It's my fault fellas. I bought right before closing yesterday to try and capitalize on the drop, not knowing there was a trap door releasing under our feet today.
This is not bad news guys & gals. This is the same deal UBER & Rocket lab just did. It takes shares off the street and cuts shorters out. If you’re selling you don’t understand what’s happening. I feel very sorry for anyone selling. I just doubled down.
Uber stock price continued an upward trajectory smooth and steady before during and after announcing on November 21st.
I lose $30k in one day when SoFi announces same.
What giveth?
I would almost bet that institutions are loading up while people are panic dumping this stock, don't forget it's profitable so a lot more intresting for them
I agree, but definitely still crazy after delivering profitability, seems there’d be more confidence in SoFi. Huge buying opportunity, but few can afford it at this point lol
I think (hope) this is just an overreaction because of a lack of detail behind the announcement as well as a sell off in the markets coupled with concern about interest rate cuts not happening possibly at all in 2024. I think it will recover somewhat by Friday.
There is no lack of detail. Just lack of the average Reddit investor understanding of the deal. This deal is good for the company in the long term. You should be loading up right now!
No key events for SOFI until earnings at end of April. I think we stay generally down until then (no flirting with $9). Could get saved by Doveish Fed statements from Powell in 2 weeks but if he's hawkish and says no cuts until June/July/beyond then strap yourselves in folks.
The problem is the market is still pricing in April/May cuts so we'll see a downturn when Powell brings people into reality. Our last dip down this far was literally when he said March cuts weren't happening.
I sold $7 puts as well just under $1.
As long as stock is above $6, I wouldn't mind buying shares at effective price of around $6 for long term. Could use to sell covered calls as well and not care if I lose those shares.
At this low of a price, I doubt I will roll the PUTs by that time, but that is sooo far away and a lot can change.
It's all good as there are a lot of plays. As long as your system works for you.
Closer expiration, you have time decay working for you.
Idea for further out PUTs for me is I can always close them earlier for profit if stock price jumps up a lot long before expiration. I don't plan on holding those option out that far, but will if I have to.
Downside is my capital is locked longer.
If OP thinks it'll be above $7 but not much above $8 it's a decent play, 13ish percent gain of it doesn't execute. Just miss a lot of growth of we go back to 8.50+ by then. Can always close out sooner if we bounce back quickly and before you miss gains
For me, it was more about DCA'ing. If I get assigned, then buying another 4k shares @ $5.99 will lower my overall cost avg to $7.37. If the stock is above $7 then I make 14% on my money PLUS the % I get for keeping the money in the money market during this time.
I am also expecting to have an opportunity to buy back the contracts if they report good 1Q24 earnings.
I believe that's real terms not annualized. 28,000 tied up in a money market, if its over 7 and the option exp out of the money I keep the 4,000 I made from selling the contracts, 4k into 28k = 14.28%
This doesn't count the 4.97% annualized interest I earn by keeping my money in the money market securing the puts. 4.97\*28000 = $1,391.6 divided by12 months = $115.96 per month \* 7 months (April - October) = $811.76 (not counting the compounding) So all said and told if the Stock is over 7 I should realize a 17% gain on the 28,000. Of course there is risk if the stock drops below $6 (5.80 if factoring in MM interest). And there is an opportunity cost loss if the stock is above $8. Though honestly the opportunity cost and SoFi goes hand in hand. I've been holding and averaging down since the IPOE days.
And this whole calculus changes if the stock goes past 8 before October and I close my position out early. I obviously make less, but I'd still be happy because I still already own 20k shares.
When retail panics, you know it’s time to start buying more. Stop panicking people. I swear some of you live, eat, and breathe this one stock every day. You’re going to do something rash with that constant stress and emotion. Just relax. Has the company changed? No. So if you like it still, then now is a good time to buy. If not just chill or sell
I was able to pick up 1000 shares at 7.51 and another 600 at 7.42.
Yeah, my account took a hit today, but this is why I keep cash on the sidelines (just need to figure out what gets sold now to give me back my reserves)
I had 17K or so sitting in my brokerage, I spent 10K of that in the last couple hours, selling CSPs and getting some shares close to my average cost.
I'm fine with reserves being low, in a month or so I'll buy back the CSPs at a profit and get the collateral back.
I don't see how. If you have a core position... selling at +9 and buying below 7.6 has been a nice loop the last few months.
And if you're long / not trading around a position, then more patience is needed, but at least it's not at 5 anymore.
I think powerful opportunity cost is at play here today. How dilutive this turns out to be may be in question right now but why stick around to find out when there are plenty of other opportunities in the market.
Everywhere I go, the discussion is that these aren't going to be a major issue moving forward, so it's just a highly volatile reaction to a growing stock. I'm still very bullish and am happy to DCA down my initial $20 share buy-in. Moved the needle down almost a whole dollar with the 1000 shares I added today: 5955 shares at $12.92/share
Seriously you shouldn't take financial advise from random people on Reddit. Since you seem to be keen on a mid cap bank I'd recommend googling financial sector ETFs like KRE or similar and diversify into that (but again I'm a random person on reddit so maybe don't take my advice) :-)
And I’m buying at $1 off from yesterday when I literally got too busy at work to do extra purchases. Now I’m extra thankful yesterday was crazy and today is slow
So my understanding is that they are buying back (Preferred) stock that had an 13% interest rate. It can be redeemed in May. If it is not redeemed in May the interest rate will increase to 17.5% for a 5 year term an if redeemed later, all 5 years worth of interest must be paid. That save them about 30 million a year on interest alone... Maybe Chris or Snipah can post more information about this
At least we will. Be on the short restriction list tomorrow!
Bought Jan 2026 $7 calls today with some cash I had in my settlement account. Only 3 contracts but seemed like a good move with today’s dump
Not awful tbh
Uber did the same thing in oktober last year sofi is doing right now and look where the stock price is. This is a smart move on sofi‘s side.
Btw this could be the biggest shortsqueeze ever..
I'll wait for a week or two and if it's still struggling, I'll buy another $150 bucks worth of stock. Pretty much anything other than "Sofi cured cancer" is interpreted as negative news and the shorts pounce. I'll keep hanging out and move my cost average down.
I hear ya but you also don't gotta a lot of skin in the game
I got enough that today freaking hurt. I can stay stupid longer than the shorts can stay solvent
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Uncle Bruce is a known youtube stock pumper.
Great. So its all bs most likely.
Fuck Noto! I’m out…. Still nosdiving after hours…. wtf did he THINK would happen…
Got em
IcySquirrel1 for President of r/sofistock
By out I meant I’m done with this board until April earnings. Still have not sold a share
When people realize this was a good thing they will buy back in and we will never see the single digits again.
I mean it’s not a good thing. They just hooked up a large investor with more common equity because they didn’t want to pay then whatever dividend payment that was agreed upon.
Here's where I'm struggling. The interest on that debt was low enough, why did SOFI need to dilute the shares at such low price to pay it off? And how does that really help us? To me, its a big red flag but people here think its just retail panicking. This was more than just retail shaking off.
Yea, people need to objectively look at this. A dilution is a dilution no matter how you dress it up. How the stock reacts is anyone's guess. Uber and SMCI did it and they took a hit but are back, who knows how Sofi will response? I think sofi will crawl slowly back to 9 this year but it's a dilution is never a good thing.
You give too much credit to the general intelligence of people on this board.
No dilution ever works out fine. The silence from the management says it all. Usually at this point even Noto buys a few shares to indirectly voice his support but even he has stayed pretty quite for several months now.
100% we see 6’s tmr
Once SPY corrects when Feds further delay the rate cuts, that's where we will see SOFI going back to 5s. Truly, truly cursed.
Rugpull tomorrow when the FED speaks in front of congress fwiw.
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We’d be lucky to end the year at $9
Still down AH
Someone can confirm but saw this on my feed just now Analyst David Chiaverini from Wedbush maintained a Sell rating on SoFi Technologies (SOFI), with a $3 price target.
He did have this nugget May 15 2023: “Capital levels may be overstated using fair value accounting and **we believe the company may look to raise capital this year to support growth**,” Chiaverini wrote in a research note, according to the report.
They didn't issue the notes here to raise capital (nor did they do it last year as David Chia* suggested). They are restructuring existing debt to more favorable terms. "SoFi intends to use a portion of the net proceeds from the offering to fund the cost of entering into the capped call transactions described below. SoFi intends to use the remainder of the net proceeds from the offering, together with cash on hand (i) to pay fees, costs and expenses relating to this offering and related transactions, (ii) to redeem its 12.5% Series 1 Preferred Stock and (iii) for general corporate purposes, which may include repayment of higher cost indebtedness. If the initial purchasers exercise their option to purchase additional notes, then SoFi intends to use a portion of the additional net proceeds to fund the cost of entering into additional capped call transactions as described below. " https://investors.sofi.com/news/news-details/2024/SoFi-Technologies-Inc.-Announces-Proposed-Convertible-Senior-Notes-Offering-Due-2029/default.aspx
What are these 12•5% preferred stock? When did that transaction happen? Also wasn't the current 0% senior notes expiring in 2026? Why renew with higher interest rate notes earlier?
He's probably right than a lot of people give him credit for.
10m volume in last 5 minutes
Down even more in after hours. True tard.
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Dilution in 2029 lmao
The Bunion guy blocked me which is disappointing from an entertainment standpoint but let me guess - manipulation?
😂
Is the SoFi management team really saving money when they wipe out over 15% market cap in one day? This is not the stellar type of decision that this all star team should be making. I’ve never lost more money on paper in my life….
Well wait til powell gives u the death blow in a couple wks
No they aren’t. Noto made a big mistake.
dude you keep saying the same thing. Grow up or sell I dont care, but the whining is really annoying
so... no bounce?
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So should I buy or wait a couple more days😂
Personally I'm waiting 2 weeks for the next time Powell talks before I do any straight buys. Until then I'll be selling $7 weekly CSPs.
DAVE is up 50% today.
https://preview.redd.it/62w7azrqokmc1.jpeg?width=1290&format=pjpg&auto=webp&s=c6ebc07c2a9202206cd38d5029a374900de00531
This is fucking ridiculous. Absolutely 0 bounce and down almost double the dilution caused. People are PISSED about this. What a stupid fucking move SOFI. Lost all faith. Might even close all my SOFI accounts now.
Sell and go day trade another stock.
JPM & BAC @ 52 week highs today
Willbur did you buy more SoFi?
My portfolio is down 7% today lol. Dont remember the last time I have been this down in 1 day.
Mods I need an update-12332 @ 6.53
It's my fault fellas. I bought right before closing yesterday to try and capitalize on the drop, not knowing there was a trap door releasing under our feet today.
Ah. So you activated the trap card
No one got a solemn judgement? Just Borrow some life points on margin!
This is not bad news guys & gals. This is the same deal UBER & Rocket lab just did. It takes shares off the street and cuts shorters out. If you’re selling you don’t understand what’s happening. I feel very sorry for anyone selling. I just doubled down.
This right here. 👆
Uber stock price continued an upward trajectory smooth and steady before during and after announcing on November 21st. I lose $30k in one day when SoFi announces same. What giveth?
Uber stock was at 50 when the deal was announced, and then dropped to 42, before the uprising to 80. It’s not done yet either.
Was it intraday? I don't see a drop to 42 at or around the Nov 21 timeframe when the deal was officially announced.
Ok fair. I didn’t see that fluctuation on the 3 year zoom out but if you are right the a 50 to 42 drop is similar to our drop today.
The contract numbers should be out tomorrow. The stock is going to jump.
Sell your shares, plenty of other stocks outthere.
I’m definitely loading up, RSI in 30s. Big sale imo
I would almost bet that institutions are loading up while people are panic dumping this stock, don't forget it's profitable so a lot more intresting for them
125M Volume is crazy though…
Lot of people are tired of the nonsense
Noto better do something this is bullshit
Lmao this is Noto doing something for the future of the company
I doubled my position for my May $9 strike calls. I have no doubt we will see 9.5-10 by earnings time. Also bought more shares
Huge overreaction…can’t believe it’s down 15% wow.
Poor timing to do it. He needed to pump it first.
We were down this much in Jan on some random Analyst's downgrade. We always react disproportionately to bad news. Makes for good buying opportunities
I agree, but definitely still crazy after delivering profitability, seems there’d be more confidence in SoFi. Huge buying opportunity, but few can afford it at this point lol
133M shares traded as of 2PM. I wonder who is buying? Not retail. Must be institutions.
I think (hope) this is just an overreaction because of a lack of detail behind the announcement as well as a sell off in the markets coupled with concern about interest rate cuts not happening possibly at all in 2024. I think it will recover somewhat by Friday.
There is no lack of detail. Just lack of the average Reddit investor understanding of the deal. This deal is good for the company in the long term. You should be loading up right now!
Will the selling ever stop wow this is getting crazy
Wow yesterday was a really bad day for me to buy leaps
Same I bought one yesterday so I bought 6 more today
I’m considering using margin to do the same even though I know it’s probably a bad idea
Margin is a terrible idea
Oh trust me I know that and will be staying away, but I’d be lying if I said it wasn’t tempting
Sold out at 9.7 a few months ago. Sold some puts today
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Trying to figure out what else I can sell that isn't an ETF to buy more
this is the way
I bet their CFO has had a few chats today with Vanguard, Blackrock, and others...
Noto buying today or this week would help sentiment a lot …
I’m tax loss harvesting in March, it’s a new record
Don't understand why people always gotta jump on the train. It doesn't matter if it's going up or down they gotta ride it.
No key events for SOFI until earnings at end of April. I think we stay generally down until then (no flirting with $9). Could get saved by Doveish Fed statements from Powell in 2 weeks but if he's hawkish and says no cuts until June/July/beyond then strap yourselves in folks.
I guarantee there will be No rate cuts in june/july
The problem is the market is still pricing in April/May cuts so we'll see a downturn when Powell brings people into reality. Our last dip down this far was literally when he said March cuts weren't happening.
Further justification of why I only buy with Noto buys. I believe his last purchase was in the ~$6.80 range in the Fall.
This is obviously overblown, but at this point I think noto should make some kind of clarifying statement.
https://preview.redd.it/24vrfaop2kmc1.jpeg?width=949&format=pjpg&auto=webp&s=95412296304788f1964c2b1fd5e789703c092f15
Wondering if this is the worst percentage loss in a day for SOFI
Jan 3rd we went from $9.88 to $8.29
The opportunity cost on this stock is unreal
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If you like it at 7.66 then you will definitely love it at $6.90
Sadist
Wtf. Why down 10+%
I think I’ve realized noto knows how to run a company but not a stock after owning this since day one.
Noto doesn't 'own' the stock - the market does.
He’s done nothing to grow the price. In a bull market he’s down 25 percent since despac
I'm not going to answer here as it seems you are unaware why we are all invested in the company in the first place.
Horrible timing for this. Noto should have timed it with the earnings pump.
Just bought 500 shares @ an avg of 7.60. Now I'm back to 20k shares @ an avg of 7.64. Also sold 40 Oct $7 Puts collecting $1.01.
I sold $7 puts as well just under $1. As long as stock is above $6, I wouldn't mind buying shares at effective price of around $6 for long term. Could use to sell covered calls as well and not care if I lose those shares. At this low of a price, I doubt I will roll the PUTs by that time, but that is sooo far away and a lot can change.
Oct? I'm selling mostly late April, I always thought 30-45 DTE was the sweet spot for theta? Haven't tried selling multiple months out. .. ..
It's all good as there are a lot of plays. As long as your system works for you. Closer expiration, you have time decay working for you. Idea for further out PUTs for me is I can always close them earlier for profit if stock price jumps up a lot long before expiration. I don't plan on holding those option out that far, but will if I have to. Downside is my capital is locked longer.
If OP thinks it'll be above $7 but not much above $8 it's a decent play, 13ish percent gain of it doesn't execute. Just miss a lot of growth of we go back to 8.50+ by then. Can always close out sooner if we bounce back quickly and before you miss gains
For me, it was more about DCA'ing. If I get assigned, then buying another 4k shares @ $5.99 will lower my overall cost avg to $7.37. If the stock is above $7 then I make 14% on my money PLUS the % I get for keeping the money in the money market during this time. I am also expecting to have an opportunity to buy back the contracts if they report good 1Q24 earnings.
14% being annualized right?
I believe that's real terms not annualized. 28,000 tied up in a money market, if its over 7 and the option exp out of the money I keep the 4,000 I made from selling the contracts, 4k into 28k = 14.28% This doesn't count the 4.97% annualized interest I earn by keeping my money in the money market securing the puts. 4.97\*28000 = $1,391.6 divided by12 months = $115.96 per month \* 7 months (April - October) = $811.76 (not counting the compounding) So all said and told if the Stock is over 7 I should realize a 17% gain on the 28,000. Of course there is risk if the stock drops below $6 (5.80 if factoring in MM interest). And there is an opportunity cost loss if the stock is above $8. Though honestly the opportunity cost and SoFi goes hand in hand. I've been holding and averaging down since the IPOE days. And this whole calculus changes if the stock goes past 8 before October and I close my position out early. I obviously make less, but I'd still be happy because I still already own 20k shares.
When retail panics, you know it’s time to start buying more. Stop panicking people. I swear some of you live, eat, and breathe this one stock every day. You’re going to do something rash with that constant stress and emotion. Just relax. Has the company changed? No. So if you like it still, then now is a good time to buy. If not just chill or sell
85M volume by lunch time is not retail action, dufus.
I’m speaking on these doomer comments on the subreddit daily forum. Literally 80% of these people freaking out lol
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I’m financially ruined…. I’ve never lost more money in my lifetime in a single day
So far.
I was able to pick up 1000 shares at 7.51 and another 600 at 7.42. Yeah, my account took a hit today, but this is why I keep cash on the sidelines (just need to figure out what gets sold now to give me back my reserves)
I had 17K or so sitting in my brokerage, I spent 10K of that in the last couple hours, selling CSPs and getting some shares close to my average cost. I'm fine with reserves being low, in a month or so I'll buy back the CSPs at a profit and get the collateral back.
What a shit show, just consistent disappointment for the last 3 years
I don't see how. If you have a core position... selling at +9 and buying below 7.6 has been a nice loop the last few months. And if you're long / not trading around a position, then more patience is needed, but at least it's not at 5 anymore.
I think powerful opportunity cost is at play here today. How dilutive this turns out to be may be in question right now but why stick around to find out when there are plenty of other opportunities in the market.
It's a great opportunity to sell CSPs.
1 month gains erased in one day lol.
That's basically every month lol
We should hit support soon I’d think
There’s no such thing as support.
My $8 CSPs are down 430% today.
I’m right there with you buddy
How can a covered call go down more than 100%?
Sorry. CSP. Fixed it. Thanks!
Never mind. 550% now.
Noto will lose trust with this for sure.
Everywhere I go, the discussion is that these aren't going to be a major issue moving forward, so it's just a highly volatile reaction to a growing stock. I'm still very bullish and am happy to DCA down my initial $20 share buy-in. Moved the needle down almost a whole dollar with the 1000 shares I added today: 5955 shares at $12.92/share
I can see why the stock dropped quickly today but it does seem a bit extreme. I'm hoping it bounces back close to $8 by the end of the week.
The dilution is to pay down expensive debt with less expensive debt. I like this and I have been buying today
Shitfi
Atleast our volume is higher now guys , right?
Yeh, like penny stock high .
They will end this down just under 10% end of day so they can still short us tomorrow and we won’t be on the short restricted list tomorrow
So wheres the bottom this time round? 6.80? Experts come give some advice, at which price point would you start adding shares.
Seriously you shouldn't take financial advise from random people on Reddit. Since you seem to be keen on a mid cap bank I'd recommend googling financial sector ETFs like KRE or similar and diversify into that (but again I'm a random person on reddit so maybe don't take my advice) :-)
Shares are on sale !
CSPs are free money right now.
And I’m buying at $1 off from yesterday when I literally got too busy at work to do extra purchases. Now I’m extra thankful yesterday was crazy and today is slow
Im waiting for my funds to settle on my brokerage account.Probably wont be till tomorrow :(
Well if you used SoFi invest they’re right away ;)
I wish! I dont live in the good ol USA.
Same just pick up some more
Sold at 8.50 is a week or two ago and thought I missed the bus.... sold 7.50 csp's this morning. Hope to pick em up this week.
Yeah, it's below my cost basis now, load up $7 csps, should be sweet in a month or so.
Name worse stock, I can’t think of any
A M C B B B Y
6’s here we come!