SoFi Short Interest Climbs Again With Five Days to the Print

SoFi Technologies now has 218 million shares sold short, equal to 18.1% of free float, the highest level recorded in at least a year and a further step up from the 17.8% flagged in last week's note.

The build has been relentless since early October. Short interest was running around 199 million shares at the start of the month. It jumped to 214 million between October 7 and October 8, repeating the step-change pattern seen in the September 22 to 23 surge. Since then it has continued to grind higher, adding a further 1.8% over the past week alone and 21% over the past month. FINRA's most recent fortnightly settlement puts the official short count at 214.9 million shares with 4.15 days to cover. The stock itself has moved the other way: down 3.7% over the week to $14.68, and off 13.4% over the past month, against a median one-week change of roughly minus 1.1% for its closest peers. Upstart Holdings fell 0.75% over the same week, Dave Inc. added 0.2%, and American Express gained 2.7%, underlining how much of the weakness is specific to SoFi rather than sector-wide.

The borrow market tells a more nuanced story. Availability has tightened sharply this week, dropping to 84.8% from 140% a week ago. That reverses the loosening noted in last week's note. The 52-week trough for availability is 79.6%, so the lending pool is not yet at its most stressed point of the year, but the direction of travel has turned. Cost to borrow has edged up to 0.58%, its highest of the past month, though in absolute terms it remains low. Options positioning shows no particular alarm: the put/call ratio at 0.44 is fractionally below its 20-day average of 0.45, and the z-score of minus 0.44 indicates no unusual skew toward downside protection. That is an interesting divergence. Short sellers are adding to positions, but options traders are not paying up for puts ahead of the October 26 earnings release.

The Street's overall direction on SoFi has become more cautious in recent months. StoneX initiated with a Buy and a $25 target on October 13, but the broader tone from analysts who have published recently is restrained. TD Cowen trimmed its target to $17.50 while maintaining Hold earlier this month. Mizuho, which is still constructive, cut its target sharply from $29 to $22 in late July. Morgan Stanley kept an Underweight rating and lowered its target to $15. The mean price target across the coverage universe is $20.36, implying roughly 39% above the current price, though the distribution is wide. The bull case centres on 43% year-over-year revenue growth in Q1, a 90% surge in personal loan originations, and continued Rule of 40 outperformance. The bear case points to the Technology segment, where adjusted net revenue fell 27% in Q1 and margins compressed to 16%, and to Q2 guidance that came in below consensus on EPS. The price-to-book multiple has contracted by about 0.25 turns over the past month to 1.5 times, and the PE has pulled back by 3.4 turns over the same period to 18.9 times.

FDIC call report data from the Federal Deposit Insurance Corporation shows SoFi's bank charter total assets have risen for nine consecutive quarters to $56.8 billion, and total deposits have also risen for nine consecutive quarters to $46.8 billion. The FDIC dataset has not yet been tested as a leading indicator against SoFi's reported figures, so it is colour rather than signal, but the streak documents that the deposit base has been expanding consistently even as the equity has sold off.

Goldman Sachs Asset Management added 9.6 million shares as of October 1, bringing its holding to 15.4 million. BlackRock added 2.9 million shares and now holds 72.4 million, equal to 5.6% of shares. Both are passive-style filings rather than activist positions. No Schedule 13D activist appears on the register. CEO Anthony Noto holds 12.3 million shares and added 315,830 in the period ending September 14. Recent insider activity in the filing record is dominated by tax-withholding transactions in mid-September and two pre-planned 10b5-1 sales by the CTO and an EVP, both small relative to their holdings.

The October 26 print will be the first data point after a month of steady short accumulation, a tightening borrow market, and a stock trading at its lowest level in over a year.