SoFi Isn't the Only Digital Banking Stock Available in the Market. This Fintech Stock Trades at a Fraction of the Valuation and Is Growing Earnings Fast.

Core Viewpoint - Investors are encouraged to explore lesser-known opportunities in the market, as they may offer better potential than popular stocks like SoFi Technologies [1] Company Overview: SoFi Technologies - SoFi Technologies has been a favored choice among retail investors, achieving over 37% gains in the past year [2] - The stock is currently trading at a high valuation, approximately 34 times forward earnings and nearly 10 times forward sales [2] Company Overview: LendingClub - LendingClub specializes in personal lending, particularly for credit card debt consolidation, and is expanding into home improvement loans [5] - The company transformed into a more profitable entity after acquiring a bank in 2021 and refining its platform [6] - In 2024, LendingClub reported diluted earnings per share (EPS) of $0.45, which grew by 154% to $1.15 in 2025, with guidance for 2026 EPS between $1.65 and $1.80, indicating nearly 50% growth at the midpoint [7] Financial Metrics: LendingClub - LendingClub has a market capitalization of $1.8 billion, with a current stock price around $15.20 [9][17] - The company has a gross margin of 72.88% and has made significant accounting changes to simplify its business model [9][11] - The management aims to increase loan originations to $12.1 billion this year, with a medium-term goal of $18 billion to $22 billion [12][13] Valuation Comparison - LendingClub trades at less than 10 times forward earnings and 1.8 times forward revenue, significantly cheaper than SoFi [15] - Analysts expect LendingClub to generate $2.40 in EPS by 2027, suggesting a potential share price of $24 if the market recognizes this growth [15][17] Strategic Goals - LendingClub's management is focused on elevating returns, targeting a return on tangible common equity (ROTCE) of 18% to 20% in the medium term, currently at about 12% to 13% [13]