Mizuho Still Bullish on SoFi Technologies

Mizuho analysts remain optimistic about SoFi Technologies (NASDAQ:SOFI), reiterating their Buy rating and a price target of $12 for the stock. The analysts highlighted the potential positive impact of SoFi's recent $750 million convertible note offering and a $600 million equity exchange, which initially raised concerns about stock dilution among investors.

According to Mizuho, the benefits of these financial maneuvers could eventually sway investor sentiment positively. They anticipate that the equity exchange could enhance the company's tangible book value per share by about 10% and significantly strengthen its capital ratios by more than 200 basis points, all without substantially diluting earnings per share.

Moreover, the analysts pointed out that the convertible note offering could reduce the company's annual interest expenses by over $60 million, effectively offsetting the estimated $90 million in capped call costs within approximately a year and a half.