SoFi Technologies Inc
SoFi management characterized the claims as a "fundamental lack of understanding" of their business. The company also signaled intent to "explore potential legal action" against the firm.
Muddy Waters Alleges Accounting Red Flags
The conflict began Tuesday when Muddy Waters, led by Carson Block, labeled SoFi a "financial engineering treadmill."
The report alleged that SoFi's 2025 adjusted EBITDA was inflated by 90%. Muddy Waters suggested the true figure was $103 million rather than the reported $1.05 billion. The report also questioned loan charge-off rates and "Enron-esque" off-balance-sheet structures.
Allegations of Investor Deception
SoFi claimed the short-seller's report was "designed to deceive investors."
SoFi management pointed to Muddy Waters' own disclosures. The firm intended to cover short positions immediately after publication. "They stand to profit from their own misleading report," SoFi added.
Technical Analysis
SOFI is trading 5% below its 20-day simple moving average (SMA) and 29.5% below its 100-day SMA, keeping the intermediate trend pointed down even as the stock tries to base.
Shares are up 45.36% over the past 12 months, but they're currently positioned closer to their 52-week low of $8.60 than the 52-week high of $32.73.
The RSI is at 31.75, which sits in the lower end of neutral. Meanwhile, MACD is at -1.0767 versus a signal line of -1.1731.
- Key Resistance: $18.50
- Key Support: $17.00
