NVIDIA Corporation (NVDA)vs SoFi Technologies, Inc. (SOFI)

Quick verdict

NVIDIA and SoFi Technologies sit in very different corners of the market. NVIDIA, a $4.91tn semiconductor giant, combines extremely high profitability (net margin 62.97%, ROE 111.66%) with a forward PE of 10.38 against a trailing PE of 30.92, implying anticipated earnings growth. SoFi, a $22.17bn financial services firm, trades on a trailing PE of 36.16 with no forward PE reported, a net margin of 11.22%, and ROE of 6.25%. Both carry high beta (2.211 and 2.149 respectively) and have seen significant drawdowns, though SoFi's maximum 5-year drawdown of -47.4% is steeper than NVIDIA's -29.43%. Verdicts score NVIDIA an overall 4 versus SoFi's 2, with NVIDIA rated A across growth, quality, balance sheet and income, and B for valuation and momentum, while SoFi scores lower on valuation (B) but shares an A in growth. Style tags describe NVIDIA as 'high-growth, value' and SoFi as 'high-growth, high-volatility'.

2-year relative performance

At-a-glance comparison

Business model and revenue mix

NVIDIA designs advanced graphics, computational and networking hardware, with its Graphics division built around GeForce GPUs for PC gaming, alongside the GeForce NOW cloud gaming service, operating across the US, Taiwan, China and other markets. It sits in the Semiconductors industry within Technology. SoFi Technologies operates in Financial Services, specifically Financial - Credit Services, delivering a broad range of online financial products. Where NVIDIA's revenue is tied to hardware cycles and computational demand, SoFi's model centres on digital lending and financial services distribution. NVIDIA's scale is reflected in a market cap of $4.91tn versus SoFi's $22.17bn, and its average trading volume of 156.7m shares compares with SoFi's 76.4m, indicating differing levels of market liquidity and investor base size.

Valuation

NVIDIA trades at a trailing PE of 30.92 but a forward PE of just 10.38, alongside a PEG ratio of 0.28, suggesting the market expects substantial earnings growth relative to the current multiple. Its price-to-sales ratio stands at 19.38 and price-to-book at 25.2, both elevated in absolute terms, with EV/EBITDA at 25.45 and FCF yield of 4.34%. SoFi's trailing PE is higher at 36.16, with no forward PE supplied, and a PEG of 5.42, indicating a much richer valuation relative to its growth profile. SoFi's price-to-sales of 4.31 and price-to-book of 2.04 are considerably lower than NVIDIA's, while its EV/EBITDA of 23.18 and FCF yield of 3.95% are broadly comparable. The valuation verdict is B for both companies overall in this comparison.

Growth profile

NVIDIA has posted a 3-year revenue CAGR of 65.47% and 5-year revenue CAGR of 21.13%, with EPS growth even stronger at 65.99% over 3 years and 32.08% over 5 years. SoFi's revenue growth has been more modest, at 28.78% over 3 years and 7.75% over 5 years, while its EPS CAGR was negative at -8.7% over 3 years but positive at 11.33% over 5 years, pointing to inconsistent earnings trends. Both companies earn an A verdict for growth, reflecting strong top-line expansion at NVIDIA and respectable revenue growth at SoFi despite earnings volatility. The scale and consistency of NVIDIA's growth across both revenue and EPS metrics stands out relative to SoFi's more uneven profile.

Profitability and quality

NVIDIA's profitability metrics are exceptionally strong: gross margin of 74.15%, operating margin of 64.02%, net margin of 62.97%, ROE of 111.66% and ROIC of 62.99%. SoFi's gross margin of 76.02% is comparable to NVIDIA's, but its operating margin (12.56%), net margin (11.22%), ROE (6.25%) and ROIC (4.29%) are all substantially lower, reflecting the different economics of financial services versus semiconductor hardware. The quality verdict rates NVIDIA A, consistent with its high returns on capital and wide margins beyond the gross level. SoFi's high gross margin does not translate into comparable bottom-line profitability or capital returns based on the figures provided.

Balance-sheet risk

NVIDIA holds cash of $10.1bn against total debt of $69.33bn, with net debt/EBITDA of -0.17, a current ratio of 3.44 and interest coverage of 27.55, indicating strong liquidity and debt-servicing capacity. SoFi reports higher cash of $25.83bn against total debt of $83.74bn, with net debt/EBITDA of -0.92 and interest coverage of 23.65, both metrics suggesting adequate coverage, though its current ratio of 0.17 is markedly lower than NVIDIA's, reflecting the different balance sheet structure typical of a financial services firm. The balance sheet verdict favours NVIDIA with an A rating in this comparison.

Price performance and shareholder returns

Over one year, SoFi has returned 86.87% versus NVIDIA's 75.11%, while year-to-date NVIDIA is up 2.83% against SoFi's decline of -2.38%. Over longer horizons, NVIDIA's 3-year annualised return of 3.02% trails SoFi's 23.51%, but NVIDIA's 5-year annualised return of 32.41% is more than double SoFi's 13.61%. NVIDIA's maximum 5-year drawdown of -29.43% is considerably shallower than SoFi's -47.4%, indicating lower historical downside volatility despite both stocks carrying high beta values (2.211 for NVIDIA, 2.149 for SoFi). The momentum verdict is B for both in this comparison, reflecting mixed short and medium-term return patterns.

Which stock fits which investor

Based on the supplied verdicts, NVIDIA carries an overall score of 4 versus SoFi's 2, with NVIDIA rated A for growth, quality, balance sheet and income, and B for valuation and momentum. SoFi's verdict profile shows B for valuation with growth also rated A. The bestFor mapping designates NVIDIA as the stronger fit for growth-, quality- and income-oriented criteria, while SoFi is identified as the stronger fit for value-oriented criteria among the two. Both are tagged as high-growth, with NVIDIA additionally described as 'value' and SoFi as 'high-volatility', reflecting their differing risk and valuation characteristics as captured in the data.

• Value: SOFI
• Growth: NVDA
• Income: NVDA
• Quality: NVDA

Frequently asked questions

Which company has stronger profit margins, NVDA or SOFI?

NVIDIA has substantially stronger margins, with a net margin of 62.97% and operating margin of 64.02%, compared with SoFi's net margin of 11.22% and operating margin of 12.56%.

How do the valuations of NVDA and SOFI compare?

NVIDIA's forward PE of 10.38 and PEG of 0.28 suggest growth-adjusted value, while SoFi's PEG of 5.42 and trailing PE of 36.16 indicate a richer valuation relative to its growth profile.

Which stock has performed better over the past year?

SoFi returned 86.87% over one year, ahead of NVIDIA's 75.11%, though NVIDIA's 5-year annualised return of 32.41% exceeds SoFi's 13.61%.

Which stock has shown greater price volatility?

SoFi has experienced a deeper maximum 5-year drawdown of -47.4% compared with NVIDIA's -29.43%, though both carry high beta values above 2.1.

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