IFS vs. SOFI: Which Financial Service Stock Offers Better Value?

Intercorp Financial Services Inc. (IFS) and SoFi Technologies, Inc. (SOFI) are both financial services companies with a Zacks Rank of #2 (Buy). IFS has a forward P/E ratio of 8.59 and a PEG ratio of 0.35, while SOFI has a forward P/E of 81.67 and a PEG ratio of 3.09. IFS also has a P/B ratio of 1.45, while SOFI has a P/B of 4.14. Based on these valuation figures, IFS is considered the superior value option.

In the rapidly evolving fintech sector, investors are continually seeking companies that offer sustainable growth and reasonable valuations. Two notable players, SoFi Technologies, Inc. (SOFI) and Intercorp Financial Services Inc. (IFS), both with a Zacks Rank of #2 (Buy), present distinct investment propositions. This article aims to provide a comparative analysis based on their valuation metrics and financial performance.

Valuation Metrics

SoFi Technologies, Inc. (SOFI) and Intercorp Financial Services Inc. (IFS) exhibit different valuation metrics, which can be crucial for investors looking for a margin of safety.

- Forward P/E Ratio: SoFi has a forward P/E ratio of 81.67, significantly higher than IFS's 8.59. This indicates that investors are paying a premium for SoFi's growth prospects.
- PEG Ratio: The PEG ratio for SoFi is 3.09, compared to IFS's 0.35. A lower PEG ratio suggests that IFS is more undervalued relative to its growth rate.
- Price-to-Book Ratio (P/B): SoFi's P/B ratio is 4.14, while IFS's is 1.45. This further underscores IFS's lower valuation.

Financial Performance

SoFi's recent financial performance demonstrates strong revenue growth and profitability. In its second quarter of 2025, SoFi reported a 44% year-over-year increase in adjusted net revenue to $858 million, driven by a 72% jump in fee-based revenue [1]. This growth reflects a shift toward recurring income streams and a robust member base of 11.7 million, with a 35% cross-buy rate for new products [1].

Intercorp Financial Services Inc. (IFS) also shows financial strength, with a consistent track record of profitability. However, the specifics of its recent financial performance are not provided in the given source materials.

Long-Term Growth Potential

SoFi's long-term growth potential is bolstered by its diversified product suite, including loans, banking, and wealth management, positioning it to capture market share from legacy institutions. Additionally, its post-stimulus recovery positioning and innovations like blockchain-enabled international money transfers and AI-driven tools like "Cash Coach" enhance user engagement and open new revenue avenues [1].

Conclusion

Based on the provided valuation metrics and financial performance, Intercorp Financial Services Inc. (IFS) appears to be the superior value option. Its lower forward P/E ratio, PEG ratio, and P/B ratio suggest that IFS is more undervalued relative to its growth rate and fundamentals. However, investors should also consider SoFi's strong revenue growth, profitability, and long-term growth potential.

For investors prioritizing long-term stability and a margin of safety, IFS's fundamentals and realistic multiples present a compelling case. SoFi, while offering significant growth prospects, comes with a higher valuation and potential execution risks.

References

[1] SoFi Reports Second Quarter 2025, Accelerates Net Revenue Growth to Record $855 Million, Record Member and Product Growth, and Net Income of $97 Million [https://investors.sofi.com/news/news-details/2025/SoFi-Reports-Second-Quarter-2025-Accelerates-Net-Revenue-Growth-to-Record-855-Million-Record-Member-and-Product-Growth-and-Net-Income-of-97-Million/default.aspx]