Affirm vs SoFi Technologies Which Is a Smarter Choice?

Affirm and SoFi Technologies are two notable players in the financial technology industry, both offering innovative solutions in the realm of digital payments and lending. Affirm, founded by PayPal co-founder Max Levchin, focuses on providing transparent and flexible payment options for consumers. SoFi, on the other hand, offers a range of financial products including student loan refinancing and personal loans. Both companies have experienced rapid growth in recent years, but their stocks have shown different trajectories in the market. Let's delve deeper into the comparison of Affirm vs SoFi Technologies stocks.

Affirm or SoFi Technologies?

When comparing Affirm and SoFi Technologies, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Affirm and SoFi Technologies.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Affirm has a dividend yield of -%, while SoFi Technologies has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Affirm reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, SoFi Technologies reports a 5-year dividend growth of 0.00% year and a payout ratio of 26.18%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Affirm P/E ratio at -40.52 and SoFi Technologies's P/E ratio at 79.96. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Affirm P/B ratio is 6.38 while SoFi Technologies's P/B ratio is 2.66.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Affirm has seen a 5-year revenue growth of 4.24%, while SoFi Technologies's is -0.06%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Affirm's ROE at -16.49% and SoFi Technologies's ROE at 3.44%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $47.98 for Affirm and $13.57 for SoFi Technologies. Over the past year, Affirm's prices ranged from $21.88 to $57.76, with a yearly change of 163.99%. SoFi Technologies's prices fluctuated between $6.01 and $14.44, with a yearly change of 140.27%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.