DAVE vs. SOFI: Which Fintech Stock Should You Invest In Now?

Both Dave DAVE and SoFi Technologies SOFI operate within the fintech space and offer digital banking and financial services through mobile platforms. These companies target tech-savvy consumers who seek alternatives to traditional banks.

We have analyzed both stocks to find out which of these two fintech stocks provides an upside.

The Case for DAVE

Davehas experienced continuous growth in its top line on the back of its robust pricing model that improved average revenues per user and ExtraCash originations. The company logged 15% sequential and 63% year-over-year rallies in its revenues in the third quarter of 2025. This robust growth was accompanied by a 193% year-over-year surge in adjusted net income. This disproportionate rise highlights the company’s operational prowess.

The company faces heightened credit risks, which require a robust mitigation policy that DAVE has mastered over the years. Its strategic approach to credit risks resulted in a 7-basis-point (bps) dip in its average 28-day delinquency rate to 2.33% in the third quarter of 2025. Leveraging CashAI v5.5, Dave managed to keep the metric to 2.19% in September 2025. It introduced a metric, 28 days past due, and noted an 11-bps dip in September 2025, reflecting the efficacy of its credit engine.

Dave’s new fee model has played a pivotal role in attracting customers. This fee model consists of a flat 5% fee on all ExtraCash transactions with a minimum $5 fee and a $15 cap. This model did wonders for the company, as the underbanked or underserved population found it easy to grasp and cheaper than that of legacy banks.

This simplified fee model, coupled with Dave’s strategy to maintain steady customer acquisition costs, is the vital force behind its profitability engine. An efficient and strong user acquisition funnel attracted more members, and the current fee model was more efficient in retaining those members, elevating Dave’s financial performance.

The Case for SOFI

SoFi Technologies added a record 1.02 million members in the fourth quarter of 2025, bringing the total to 13.7 million. It marks 35% growth from the same quarter the year before. On a similar note, the company added 1.6 million products, marking 37% year-over-year growth to 20.2 million. Strong member addition, coupled with product additions, reflects the efficacy of SOFI’s customer-centric strategy. Drawing on this strategy, the company recorded 40% year-over-year growth in its top line, with adjusted net income noting an explosive increase of 184% from the year-ago quarter.

SoFi Technologies’ one-stop shop boosted cross-buy with 40% of new products opened by existing members, which is nearly a 7-percentage point year-over-year hike. This growth was aided by continued investment in brand building, driving SOFI’s unaided brand awareness to 9.6%, an all-time high. Heightened visibility to SOFI’s one-stop shop positions the company to operate within a sustainable environment in the long run, providing a competitive edge.

The company collaborated with NFL MVP Josh Allen to promote SoFi Plus, a premium subscription which enhanced brand visibility and strengthened product appeal among youth. The Galileo Financial Technologies buyout in 2020 has been instrumental in strengthening SOFI’s fintech infrastructure. Galileo powers critical components of SOFI’s ecosystem, which includes payment processing, buy-now-pay-later capabilities and AI-backed engagement tools.

While these positives might appeal to investors, we must acknowledge the immense competitive pressure shouldered by SOFI. The fintech space is highly populated, which reduces SOFI’s market share. The company not only competes with neobanks but also faces fierce competition from the traditional ones. Amid this pressure, the need to invest heightens, which increases the probability of failing to maintain the balance between growth and profitability.

How Do Estimates Compare for DAVE & SOFI?

The Zacks Consensus Estimate for DAVE’s 2026 sales and EPS indicates year-over-year growth of 19.4% and 5.9%, respectively. One EPS estimate has moved upward for 2026, with no downward revision over the past 60 days. For the same period, the consensus estimate for EPS is pinned at $14.07, increasing by a slight margin.

The Zacks Consensus Estimate for SOFI’s 2026 sales and EPS indicates year-over-year rallies of 26.7% and 53.9%, respectively. Five estimates for 2026 have moved north in the past 60 days against two southward revisions. During that period, the consensus mark for EPS moved up marginally to 60 cents.

DAVE Trades Cheaper Than SOFI

Dave is currently trading at a forward 12-month P/E ratio of 11.6 times, which is higher than the 12-month median of 25.17 times. SoFi Technologies is trading at 29.4 times, substantially lower than the 12-month median of 45.9 times. DAVE appears cheaper than SOFI in terms of the 12-month P/S ratio. DAVE currently trades at 3.38X while SOFI is at 4.78X.

Verdict: Add DAVE to Your Portfolio

We recommend that investors buy Dave now on the back of its operational efficiency, heightened by the CashAI v5.5 engine, which mitigates credit risks. DAVE is a fundamentally strong stock with a cheaper valuation, making it a perfect growth stock as the market realizes its actual value.

Conversely, we urge that investors retain SOFI in their portfolio and refrain from adding it further despite its growth trajectory and strong one-stop shop ecosystem. SoFi Technologies faces intense competition from traditional and neobanks, which, when combined with a higher valuation, raises future margin risks compared with Dave’s robust profitability engine.

DAVE flaunts a Zacks Rank #1 (Strong Buy), while SOFI carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research