The fintech sector has improved over the past two years, with SoFi Technologies (SOFI) and PayPal (PYPL) being the most-watched stocks. SoFi is still growing quickly as a digital bank, while PayPal is trying to regain momentum after slowing user growth and rising competition. Turning to Wall Street, while both companies carry Hold ratings from analysts, SoFi offers a higher upside potential of over 46%, compared with an upside of about 11% for PayPal.
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Let’s take a detailed look at both companies.
Is SoFi a Good Stock to Buy Now?
SoFi has spent the last few years transforming itself from a student loan lender into a full‑service digital bank. The company continues to post strong revenue growth, rising deposits, and expanding cross-selling across its financial products. Also, its bank charter gives it a major cost advantage. It allows SoFi to fund loans with low‑cost deposits, giving it an edge over traditional lenders and many fintech peers.
The company is also pushing deeper into tech infrastructure, offering banking‑as‑a‑service to other brands. This segment has become a growth engine.
However, SoFi is still proving it can deliver consistent GAAP profitability. From a valuation standpoint, SoFi looks expensive. The stock has a current P/E ratio of 62.6, raising concerns about its valuation.
With five Buy, eight Hold, and three Sell recommendations, SOFI stock scores a Hold consensus rating. The average SoFi stock price target of $23.88 indicates 46.06% upside potential.
Is PayPal a Buy, Hold, or Sell?
PayPal remains one of the most profitable fintech companies in the world; however, its growth has slowed. Competition from Apple (AAPL) Pay and other digital wallets has intensified, and user growth has weakened.
The company is now in the middle of a turnaround, focused on simplifying products, cutting costs, and improving checkout conversion. PayPal still generates billions in free cash flow and has a massive global payments footprint, but investors might want to see a clear path back to sustainable growth.
Importantly, PYPL stock trades at a far cheaper valuation than SoFi. Its current P/E ratio of 10.7 makes it one of the lowest‑priced fintech stocks on the market.
Analysts also remain neutral on PayPal with five Buy, 24 Hold, and four Sell ratings assigned in the past three months. The average PYPL stock price target of $50.75 indicates 11.06% upside potential.
Conclusion
Both stocks have a strong place in the fintech market. SoFi offers the bigger potential payoff if it continues scaling its digital bank, expands its tech platform, and delivers consistent profitability. It’s the higher‑volatility, higher‑reward option.
At the same time, PayPal offers a cheaper entry point with strong cash flow and a chance for a turnaround. The upside is more modest, but the risk is lower.