Options Bulls Eye SoFi Technologies Stock Before Earnings

SoFi Technologies Inc (NASDAQ:SOFI) will announce first-quarter earnings results before the open Wednesday, April 29. The closely watched fintech name is expected to post profits of 12 cents per share on revenue of $1.04 billion, representing a year-over-year increase of 100% and 34.8%, respectively. 

On the charts, SoFi Technologies stock saw a short rally earlier this month, breaking up a downtrend that started earlier this year. The $20 level kept a tight lid on gains, though, while underlying support has now emerged at the 50-day moving average. Year to date, the equity is down 28.4%. 

SOFI experienced a negative reaction after earnings on Jan. 30, snapping its three-quarter streak of post-earnings wins. For this upcoming report, the options pits are pricing in a next-day swing of 14%, regardless of direction, more than double the 6% move the stock has averaged over the last two years. 

In the event of a strong earnings report, a round of short covering could help give the shares a lift. Short interest represents 13.2% of the stock's available float, and it would take traders nearly three days to buy back their borrowed shares, at SOFI's average pace of trading. 

Options traders are heavily bullish ahead of the event. The security's 50-day call/put volume ratio of 3.45 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks higher than all other readings from the past year.