SoFi CEO Buys More Shares… Before This Fed Warning

Ladies and gentlemen, we're seeing a mix of both good and bad news in this video. However, the market is seemingly siding with SoFi's good news as the stock is actually going up even though we're seeing mixed results. So, in this video, I want to talk about their most recent annual general meeting as well as SoFi CEO buying more stock, their short interest announcements, and much more in this video. So, let's jump in. First up, we ended up getting this report on June 16th that Anthony Noto bought another $250,000 of his own stock in public markets. This is a cash purchase. He's not making this because of some options reward. This is not part of his compensation. This is just simply him taking his cash and putting it to work in an investment that he believes will outperform what some of his other investments are doing. But, this is not his first purchase, and this is what's so exciting, right? We ended up seeing one on May 11th, another $250,000 purchase. We saw one on May 8th, another $250,000 purchase. So, we're now at $750,000 of purchases. We also got a $500,000 purchase back in March 17th, and then another million-dollar purchase on March 2nd. Combining that all up, we're now roughly at $2.25 million. So, whenever people first started hating on these purchases, saying how small they are, you can see how quickly, in just a 3-month span, that he's been purchasing. But, to me, the most important purchase was that June 16th purchase of only $250,000. I say only, but we'll talk about that in here in a second. Whenever you look at the average prices that he's been purchasing at, you see it in the $17 ranges, 1730, 1573, $16. This is his first $250,000 that he's made above $18 a share, which is greatly increasing his overall share price. Which actually means that he's been purchasing 130,000 shares total over the last 3 months, $2.25 million at an average share price of $17.29, which is not too far away from where we are today. Now, one of the biggest criticisms of Anthony Noto's purchases is that they are small relative to his overall net worth, about $250 million. But, roughly $216 million as of the time of recording this video is coming from SoFi shares. There's been other investments that we know Anthony Noto has made, like whenever he was the CFO of Twitter, that potentially he had rotated some of those shares into new SoFi stock, or potentially he now owns SpaceX, and there could be a potential that he ends up selling those shares if he believes that they're now worth a much higher amount than whenever he was allocated those shares of Twitter. So, he might have some new buying power from SpaceX, but overall he's not going to be selling his SoFi shares to buy more SoFi shares. It just doesn't make any sense. So, even these small purchases that add to his overall holding and increasing his average share price is a very bullish signal. If we go to this article that I was reading through the Wall Street Journal, what it ends up saying is that they analyzed roughly 1,400 insider purchases over the last 5 years where executives and directors bought more than $100,000 of stock. That roughly worked out to about 280 sizable insider buying events per year across 500 companies of the S&P 500, or about 0.56 sizable purchases per S&P 500 company per year. Only 327 of those S&P 500 companies had such purchases over a last 5 year window. SoFi is blowing that away. And in fact, if you go further into that Wall Street Journal article, they talk about how these stocks end up recovering more than the S&P 500 due to these purchases, but not always. That's the important part as well. Overall, insider purchases are only good for one thing. They believe that the stock is going to go up. But, an insider sell does not necessarily mean that they believe that the stock is going to go down. They could need to fund purchases, have major life events. Who knows the reason to sell? There's only one reason to buy. But, in other news, we ended up seeing the 2026 annual stockholder meeting on June 17th. Now, whenever this ended up coming up, most of the time these are just for votes, and there's not a lot of new information, but I did catch a couple things. First up, they said SoFi Plus and big business banking are just two of the new initiatives we have, but each of these could be worth over a hundred million dollars per year. So, that's also very exciting. But, then there was another one, and I want to preface this really quickly. Basis Points had a podcast back on May 22nd, which I double checked with them that they had recorded it within the exact same week that they ended up uploading this. So, in the week of May 22nd, Anthony Noto indicated that SoFi Plus users were at 160,000. He also indicated that that happened in the first 6 weeks of them announcing this new product. But, then on SoFi side in this new annual shareholder meeting, they said, "We already have over 180,000 paying members. I would be disappointed if we didn't have 1 million of our 15 million members on SoFi Plus a year or more from now." Couple interesting points. They note that there's 20,000 more paying members or have over 180,000, right? So, we we don't know the exact amount, but I'm going off the stated number that they actually said. And then they also said back in the Basis Points podcast over here that they also wanted to get to 1 million members in 1 year. Now, they're saying to get to 1 million members in a year or more from now. A small discretion, but still something to point out. So, I ended up showing off this slide that I had made a while ago talking about how 160,000 paying members in the first 6 weeks bringing on 10 bucks a month, you're roughly looking at 1.6 million dollars a month or 19.2 million dollars per year. Now, the reason why this was really exciting was that was in the first 6 weeks. Whenever we turn to this new updated number, which is 4 weeks later, we're only 20,000 higher, which is a great deceleration. We're closer to that goal, but not nearly as fast as the growth that we saw in the first 6 weeks. So, could this be the reason for the change in sort of saying in one year to now a year or more potentially because the growth is decelerating or at least based on the numbers that we see. In other SoFi news, we also saw SoFi short interest climb to another brand new high and I mean, it's rocketing higher now at 186 million total shares traded short on SoFi stock as of May 29th and we'll soon get that update for June 15th or so. But still, this has climbed up from essentially 100 million up to 186 million, 86% increase over just a couple month period. Now, there's one clear reason for this and that's the chance of Fed rate hikes. Hikes for the most part are not good for SoFi. There's parts of their business that do better over time, but for the most part, their ability to generate loans and then sell them to other customers is their main form of business right now and that would be impacted negatively. We are now seeing for December of 2026, a 0% chance of a rate cut, a roughly 15.4% chance of no change, which is what SoFi is guiding for, and then roughly an 84.6% chance of a rate hike, which would actually be negative to SoFi's guidance. Now, Anthony Noto came out and already said that their guidance may not be impacted by rate hikes if it's not severe. They can always rotate and change their business dependent on the environment. So, if loan selling is not the business that ends up benefiting during a rate hike, maybe just holding onto those loans to maturity would be and so they would still benefit in new environments. But then we're also seeing data that would point more closely towards a rate cut rather than a rate hike considering the fact that oil has gone far below $100 a barrel now to $74 a barrel. It's still not where we'd want it to be. I'd feel a lot more comfortable if it's in the 60s or 50s range, but we are awfully close to that targeted range that we would want for a barrel of oil for inflation to come down, for cost of energy to come down, which honestly, whenever it comes to oil being such a massive energy cost for many businesses, this can bleed out into other forms of inflation. It's not just energy prices because you're end up looking at materials and food and all of these things that have to do with fertilizer and manufacturing that also take oil prices into account, and those prices get passed on to the consumer. If oil prices come down, we could end up seeing a target for future inflation, not what the Fed usually does, which is looking backwards. But what Kevin Warsh is trying to do is put in task force to help essentially get data for the Fed that that is way more modern and potentially forward-looking, rather than what they do is rely on historical data. In terms of a rate decision by December, I've got no clue where we're going to be. But what I can say is that I believe that SoFi will be able to execute appropriately to take advantage of changing rates, like they have during the fastest rate hike environment in history back in 2022. So, should we be betting on the macro, or should we be betting on the executives and the actual execution of the business? So far, SoFi has proven that execution, but now we just have to continue to do that every single quarter. And honestly, SoFi stock price is holding up, so I actually am starting to believe that people think that they will be able to handle this rate environment, whether it is no rate change or rate hikes. The market is actually pretty happy with SoFi right now, and even bringing it to higher prices than whenever even Muddy Waters was shorting the company. Essentially, all the shorters that happened in the last couple of months are all in the red right now because SoFi is hovering around that $18 price. Well, ladies and gentlemen, let me know what you guys think about SoFi down in the comments down below. And if you haven't subscribed already, make sure you do so. Till next time. Bye for now.