NEW YORK, March 17, 2026, 18:45 EDT
SoFi Technologies shares dropped Tuesday after Muddy Waters Research revealed it’s shorting the online lender, accusing the company of misstating its debt, downplaying credit losses, and inflating profits. Shares ended the day off 1.3%, paring earlier losses that topped 4%. After hours, the stock ticked up nearly 1% following CEO Anthony Noto’s purchase of about $500,000 worth of shares.
Timing’s in focus here; bullish takes not long ago leaned on SoFi’s insider buying and 2026 projections to push the idea that the selloff had gone too far. On Monday, a Seeking Alpha piece flagged the stock trading at about 14x 2026 EBITDA and highlighted Noto’s $1 million insider buy. Over at Yahoo Finance, a Barchart report from last week mentioned a consensus price target close to $26.88, with new $30 to $31 targets coming in from Citizens JMP and JPMorgan.
Muddy Waters labeled SoFi “a financial engineering treadmill,” flagging at least $312 million in debt that hasn’t shown up on the books. The firm pegged SoFi’s personal-loan charge-off rate at roughly 6.1%, and claimed 2025 EBITDA was inflated by close to $950 million. It also described the Loan Platform Business as essentially a borrowing setup, with the proceeds recorded as fee income. Muddy Waters Research
SoFi’s recent quarterly numbers looked strong. Personal-loan annualized charge-offs landed at 2.80% for the fourth quarter—or 4.4% if you exclude late-stage delinquent loan sales. For the year, adjusted EBITDA came in at $1.0539 billion.
The gap is significant, given that Muddy Waters zeroed in on the area SoFi highlights as a core driver of future growth. Back in January, SoFi reported a 53% jump in fee-based revenue, hitting a record $443.3 million for the fourth quarter. Its Loan Platform Business alone pulled in $193.7 million in adjusted net revenue and, on an annualized basis, was originating loans at a $15 billion clip. Management is projecting adjusted net revenue of roughly $4.655 billion and EBITDA of $1.6 billion for 2026.
Noto stepped in late in the session, buying 28,900 shares at an average of $17.3189 on Tuesday, according to a Form 4 filed with the Securities and Exchange Commission. That purchase brought his direct stake up to 11.7 million shares. The move didn’t address the accounting allegations, but it did show where management stands.
The stock’s rally was fueled in part by upbeat sentiment toward fintech lenders. In January, Reuters noted a 78% jump in SoFi’s financial-services revenue for the fourth quarter. CEO Noto described members’ financial health as “remained strong.” Citigroup, meanwhile, put SoFi in the same bracket as Affirm and Block, saying all three fintechs stand to gain if Washington moves ahead with its affordability agenda. Reuters
Still, a short-seller attack doesn’t guarantee a restatement—or any permanent damage to valuation. Should SoFi come out with a detailed rebuttal and hit the credit and fee-income numbers it set back in January, Tuesday’s selloff might not last. If the company falls short, though, investors could start to poke holes in the assumptions driving its lending business, loan-platform fees, and even those 2026 targets.
