SLM Corporation (NASDAQ: SLM) Shares Drop 6.86% on JPMorgan Downgrade, Revised Earnings Guidance

Shares of SLM Corporation (NASDAQ: SLM) fell to a 19-month low on October 10, 2025, with an intraday drop of 3.67% and a five-day cumulative decline of 6.86%. The selloff reflects a confluence of bearish catalysts that have eroded investor confidence in the education lender’s near-term trajectory.

JPMorgan’s downgrade of SLM from “Overweight” to “Neutral” on October 7 marked a pivotal moment in the stock’s recent weakness. The firm slashed its price target by 23.7% to $29, aligning with broader analyst caution. Barclays and Morgan Stanley followed suit with reduced price targets, narrowing the average analyst estimate to $36.14 from $36.86 in early October. These moves signal a recalibration of expectations for SLM’s earnings potential amid macroeconomic uncertainty.

Compounding the sell-off was SLM’s revised full-year 2025 earnings guidance, which now projects $3.00–$3.10 per share—slightly below the $3.107 consensus. While the company maintains a strong net margin of 16.68%, structural challenges persist. A debt-to-equity ratio of 3.02 and underperforming ROE/ROA metrics highlight vulnerabilities in capital efficiency, raising concerns about sustainability in a low-interest-rate environment.

Analyst sentiment has also shifted toward caution, with bullish ratings dwindling to a single firm in the past 30 days. The lack of consensus among analysts underscores lingering doubts about SLM’s competitive positioning in the student loan sector. Despite long-term strengths such as dividend declarations, the stock remains vulnerable to near-term volatility as investors reassess risk-reward dynamics.