Get started
UPSTART HOLDINGS, INCUPSTART HOLDINGS, INCUPSTART HOLDINGS, INC

UPSTART HOLDINGS, INC

No trades
See on Supercharts
Overview Financials News
Ideas
Discussions Technicals Forecast Seasonals Bonds

UPST trade ideas

Navigating the Peaks and Valleys of Upstart Amidst Q4 FY2023Upstart (NASDAQ: NASDAQ:UPST ) Aims to revolutionize the lending industry through the power of artificial intelligence, Upstart ( NASDAQ:UPST ) has garnered attention from both investors and industry insiders alike. However, its recent Q4 FY2023 earnings report has sparked a flurry of discussion and analysis, leaving investors pondering the next move. Let's delve into the depths of Upstart's performance and decipher the signals it sends to prospective investors. Beating Expectations, Yet Missing the Mark Upstart's Q4 FY2023 results undoubtedly showcased strength in certain areas. Surpassing Wall Street analysts' revenue projections by 3.7%, the company demonstrated resilience amidst a challenging economic backdrop. Moreover, the improvement in non-GAAP earnings per share (EPS) from a loss of $0.25 to -$0.11 year-on-year signifies a concerted effort towards profitability. However, the euphoria of surpassing revenue expectations was short-lived as attention turned towards the underwhelming quarterly guidance for Q1 2024. With projected revenue of $125 million, significantly below analyst estimates of $151.3 million, Upstart ( NASDAQ:UPST ) faces a daunting challenge ahead. The divergence between actual performance and projected outlook raises pertinent questions about the company's growth trajectory and ability to navigate the competitive fintech landscape. Deciphering the Decline in Revenue and Its Implications A closer examination of Upstart's ( NASDAQ:UPST ) revenue trajectory unveils a concerning trend. Over the past two years, the company has experienced a notable decline in revenue, plummeting from $304.8 million in Q4 FY2021 to $140.3 million in the latest quarter. While fluctuations in revenue are not uncommon in the fintech sphere, the magnitude of Upstart's decline warrants scrutiny. Several factors may contribute to this decline, including increased competition, evolving consumer preferences, and regulatory challenges. As the lending landscape continues to evolve, Upstart ( NASDAQ:UPST ) must adapt its strategies to remain competitive and capture market share effectively. Balancing Innovation with Prudence: The Path Forward for Upstart Amidst the turbulence of Q4 FY2023 earnings, Upstart ( NASDAQ:UPST ) finds itself at a crossroads. The company's innovative AI-powered lending platform has garnered praise for its ability to assess credit risk effectively and expand access to credit. However, sustaining growth and profitability in a fiercely competitive environment requires more than just technological prowess. Upstart ( NASDAQ:UPST ) must strike a delicate balance between innovation and prudence, leveraging its technological capabilities while maintaining a disciplined approach to financial management. This entails optimizing operational efficiencies, diversifying revenue streams, and enhancing customer engagement initiatives. Furthermore, transparent communication with investors is paramount in fostering trust and confidence amidst uncertainty. By providing clarity on strategic priorities, growth prospects, and risk mitigation strategies, Upstart ( NASDAQ:UPST ) can mitigate concerns and instill optimism among stakeholders. Conclusion: As investors weigh the implications of Upstart's Q4 FY2023 earnings, one thing remains clear: uncertainty looms large in the fintech landscape. While the company faces challenges on multiple fronts, including declining revenue and underwhelming guidance, opportunities for growth and innovation abound. By embracing resilience and adaptability, Upstart can chart a course towards sustainable growth and long-term value creation. Through strategic investments in technology, talent, and market expansion, the company can solidify its position as a leading player in the fintech ecosystem. As the dust settles on Q4 FY2023 earnings, investors must approach Upstart with a discerning eye, recognizing both its potential and its pitfalls. In navigating the peaks and valleys of Upstart's journey, informed decision-making and a steadfast commitment to long-term value creation will be the guiding principles for investors seeking to capitalize on the promise of fintech innovation.
NASDAQ:UPST
by DEXWireNews
Bullish Outlook on Upstart Holdings (UPST)Technical analysis involves evaluating historical price action and volume patterns to predict future behavior. The technical analysis for UPST shows mixed signals. The stock price of UPST is below its 20-day simple moving average (SMA), which is typically a bearish signal. However, it is above its 50-day and 200-day SMAs, which are generally considered bullish signals. The Moving Average Convergence Divergence (MACD) indicator is -0.9, suggesting a sell signal, while the Relative Strength Index (RSI) is 49.69, indicating the stock is neither overbought nor oversold. The entry point for the trade is $36.33, slightly above the last current price of $35.62. This could be based on the expectation that the stock will continue its upward trend. The exit point, or take profit point, is set at $39.54, which could be based on a resistance level or a calculated profit target. The stop loss is set at $35.26, slightly below the last current price, to limit potential losses if the stock price goes down. The total profit of $320.58 and total loss of $106.86 are likely calculated based on the number of shares to be traded and the difference between the entry point and the exit or stop loss points. In conclusion, while the market sentiment is bullish and the technical analysis shows some positive signals, the fundamental analysis suggests caution. Therefore, this trade seems to be based on a short-term bullish view, with a clear plan to limit potential losses and take profits at a specific level.
NASDAQ:UPSTLong
by decisioncrafters
Upstart UPST - 100% move? Rule of 72 accelerated?Portfolio Builders Club advocates for all people to build a self-directed Investment portfolio in addition to any managed or corporate led investment portfolio they may have. The energy that accelerates results is compounding. No matter how much you gain from each investment the macro goal is to repeatedly 2X(double), 3X, 4X... your initial portfolio value. No matter if you are using the rule of 72 with compounding to determine the number of years to double your investment. (72/ annual rate of return = number of years to double) The glitch in the matrix: With the rule of 72, if the rate of return is over 72%, the time to double your money is less than a year. Of course 72% is not a double. This points out that we can remove time from the equation if we are looking for higher rates of return. Therefore, the power of compounding is accelerated by looking at return on investment in terms of cycles, instead of years. The question is: how frequent can we complete each cycle? How many cycles will our risk tolerance allow us to complete over time? Do we have the patience to allow the compounding to work? ****************************************** Example of Macro Compounding No matter how long it takes to complete a cycle based on your rate of return. Double investment in each cycle (100% return with compounding) Stage 1 Stage 2 Stage 3 Stage 4 Starting with $125 $1,250 $12,500 $125,000 Cycle 1 $250 $2,500 $25,000 $250,000 Cycle 2 $500 $5,000 $50,000 $500,000 Cycle 3 $1,000 $10,000 $100,000 $1,000,000 Mind blown yet? Let's go further. Start with the lower investment Stage. Use the compounding cycles in that stage to build up to the next starting point for the next stage.
NASDAQ:UPSTLong
by PortfolioBuildersClub
Upstart Selected by MSC Union for Personal Lending Shares of Upstart Holdings (NASDAQ:UPST) charged sharply on Wednesday, climbing as much as 20.9%. When the market closed, the stock was still up 20.3%. NASDAQ:UPST is trading above all of its Moving Averages reaching a new monthly High today. Without the stock Consolidating. Mutual Security Credit Union (MSCU), a $390+ million financial institution serving the financial needs of western Connecticut, today announced its partnership with Upstart (NASDAQ: UPST), the leading artificial intelligence (AI) lending marketplace, to provide personal loans to more people. This is a significant vote of confidence for Upstart's AI-powered system, which assesses more than 1,500 variables to determine creditworthiness, resulting in more loans to consumers at lower annual percentage rates (APRs). This latest win also adds to the roster of more than 100 banks and credit unions in Upstart's network.
NASDAQ:UPSTLong
by DEXWireNews
$UPST Upstart Holdings Inc FLOAT SHORTED: 45.10%NASDAQ:UPST Upstart Holdings Inc FLOAT SHORTED: 45.10% entry PTs 24.16 (Buy date: 20 Dec '23) --> 2nd entry PT 27.43 (Buy date: 18 Jan '24) Target PTs 34 --> 24.16 --> 32.70 --> 27.43 Upstart Holdings, Inc., together with its subsidiaries, operates a cloud-based artificial intelligence (AI) lending platform in the United States. Its platform aggregates consumer demand for loans and connects it to its network of the company's AI-enabled bank and credit union partners. The company was founded in 2012 and is headquartered in San Mateo, California.
NASDAQ:UPSTLong
by BADQOMOCAWGOWLD
Upstart Holdings, Inc. (NASDAQ: UPST) Counteract The BearsShares of Upstart Holdings, Inc. (UPST) have been struggling lately and have lost 31.2% over the past week. However, a hammer chart pattern was formed in its last trading session, which could mean that the stock found support with bulls being able to counteract the bears. So, it could witness a trend reversal down the road. The formation of a hammer pattern is considered a technical indication of nearing a bottom with likely subsiding of selling pressure. But this is not the only factor that makes a bullish case for the stock. On the fundamental side, strong agreement among Wall Street analysts in raising earnings estimates for this company enhances its prospects of a trend reversal. Here's What Increases the Odds of a Turnaround for UPST An upward trend in earnings estimate revisions that UPST has been witnessing lately can certainly be considered a bullish indicator on the fundamental side. That's because empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements. Over the last 30 days, the consensus EPS estimate for the current year has increased 0.7%. What it means is that the sell-side analysts covering UPST are majorly in agreement that the company will report better earnings than they predicted earlier.
NASDAQ:UPSTLong
by DEXWireNews
$UPST vs $PGY Are They Really Similar?Ever since its public market debut in 2022, investors have been constantly comparing Pagaya Technologies Ltd. (NASDAQ: PGY) and Upstart Holdings, Inc. (NASDAQ: UPST) since they are both AI-driven fintechs. However, there is no merit to this comparison due to both fintechs’ drastically different business models. Upstart works directly with consumers to provide them access to unsecured loans, while Pagaya works with banks to improve their lending capacities. With interest rates not expected to fall anytime soon, Pagaya’s business model appears to be more immune to macroeconomic headwinds than that of Upstart which is why investors could make gains by going long on PGY stock and short on UPST stock. PGY & UPST Fundamentals Business Model The core of this article is Pagaya’s and Upstart’s business models. While both companies are AI-driven fintechs, they operate in very different ways. Pagaya’s business model is a B2B2C model where its clients use its AI platform to go through their initially declined loan applications to find good loans among them. Then, Pagaya bundles these loans and sells them to institutional investors in the form of ABS or to private investors. This is a win-win-win situation for all parties involved. First, borrowers get the loans they need. Lenders add new customers, while taking no credit risk, as well as getting the majority of the upfront fees. Finally, ABS investors have their risk spread out across different sectors and different lenders while receiving a better return on the ABS since they pre-fund the loans Pagaya’s AI includes in the ABS. As such, Pagaya realizes revenue from 3 fees which are AI integration fees charged to its partners, execution fees which are loan markups before they are put into ABS structures in addition to other fees for packaging the ABS, as well as contract fees which are charged to the private capital Pagaya manages to purchase loans. In comparison, Upstart deals directly with consumers by acting as an intermediary between borrowers and lending partners. However, since these loans are considered as “second look”, Upstart’s partners don’t retain all of these loans on their balance sheet. Instead, Upstart bundles these loans and sells them as ABS, but still retains some of them on its balance sheet as according to its latest Q3 earnings report, it held loans worth nearly $1 billion. While this is similar to what Pagaya does to an extent, there is a major difference in how both companies operate. Pagaya’s ABS are pre-funded, meaning that in case its partners don’t want to hold these loans it wouldn’t be left holding them on its balance sheet. This isn’t the same with Upstart since if its partners don’t want to hold the originated loans it is left holding them before bundling them and selling them as ABS. This is risky for a company with a weak balance sheet like Upstart as in case there’s a low demand for its loans, it would be burdened with the credit risk of these loans, unlike Pagaya which carries almost zero balance sheet risk. Who Has The Better AI? When it comes to each company’s AI, the results paint a good picture of who has the better capabilities. Pagaya is currently the number one personal loan ABS issuer by issuance size in the US as it raised more than $18 billion in ABS transactions since 2018 and $12 billion since 2012. In fact, its last four ABS issuances were oversubscribed by an average of 2 times, meaning that demand for its ABS was more than the available units. Furthermore, it added 6 new investors to its network since August, 2 of which have more than $400 billion in assets under management. This is a great indicator of the quality of Pagaya’s AI decisions as investors are rushing to pre-fund the loans processed through its platform without knowing the nature of the loans that will be included in the ABS. Meanwhile, demand for Upstart’s ABS appears to be softening. In the 9 months ended September 30, the fintech reported that 53% of its loans were sold as ABS to institutional investors. This figure pales in comparison to 65% over the same period last year. Although Upstart bulls may attribute this to the worsening macroeconomic conditions, why are institutions still showing confidence in Pagaya’s ABS, knowing that they are pre-funded? Another factor to consider is each fintech’s partners. Upstart’s largest partner is New Jersey-based regional bank Cross River Bank. Meanwhile, Pagaya just onboarded a top 5 US bank in terms of assets into its network along with a top 4 OEM captive finance company by US vehicle sales. The fintech is also in discussions with 80% of the top 25 US banks and has more than 10 opportunities across banks and auto captives that are in the later stages of business case development and onboarding. The next factor in determining which AI is better is delinquencies. In the nine months ended September 30, Upstart’s charge-offs increased a staggering 53% YoY from $70.8 million to $108.1 million. At the same time, the fintech’s management shared in the Q3 earnings call that half of its auto loan book is taking on excess defaults and expects this to persist in Q4 as well. However, Pagaya was quick to react to the macro headwinds by developing newer AI models that improve pricing by focusing on reducing delinquency rates which translates to higher returns for every incremental unit of underwritten risk. For instance, the company introduced an updated credit model in Q3 in its personal loan product that could lead to up to a .5% increase in annualized asset return. Therefore, it is no wonder that Pagaya was able to attract the top 5 bank and the top 4 OEM captive finance company to its platform in Q3. As such, it becomes clear that Pagaya takes the lead in terms of its AI capabilities. Navigating Through Macro Headwinds Based on both fintechs’ business models and AI capabilities, it is safe to assume that Pagaya is built to thrive in the current macro environment, while Upstart would only be able to rebound if macro conditions improve. In fact, looking at each company’s latest earnings call is enough to see the difference between both of them. “Our ability to approve borrowers in this environment has remained the constraint on platform growth for most of the past quarter. On the funding side of our business, banks continue to manage balance sheets conservatively and seek to unwind existing asset positions in secondary markets. Our underwriting of primer higher income borrowers has become more conservative over this past quarter, as their loss rates accelerate and converge with the broader default trends across the borrower spectrum. This has been a headwind for our volumes and fee revenues over this past quarter versus our contemplated guidance.” UPST’s management in the Q3 earnings call. “Our business is also benefiting from two structural macro tailwinds. First, banks are tightening their lending standards, pulling back on new originations as they face tight liquidity conditions, and increasing regulation. Additionally, private credit is increasingly stepping in the excess capital to deploying traditional banking assets. Given Pagaya’s position in the ecosystem, we can offer an attractive solution to both lending institutions and asset managers. If these trends continue, all else being equal, we expect they will be supportive to our growth in the near term.” PGY’s management in the Q3 earnings call. The reason behind both tones is due to their vastly different business models unlike what many investors think. Since Upstart directly deals with borrowers, it has to maintain a marketing presence so that more borrowers would use its platform to receive their loans. Meanwhile, Pagaya doesn’t have to rely on marketing spend to increase its exposure. In fact, its marketing costs declined 56% YoY in the 9 months ended September 30th from $90.2 million to $40.1 million. Instead, Pagaya relies on its partners’ customer acquisition costs since if more borrowers apply for loans at its partners, more loans would be processed through its platform. So for Upstart to grow, it has to increase its marketing spend, while Pagaya wouldn’t have to do so. But even if Upstart ramps up its marketing efforts, its volume would still pale compared to Pagaya. In Q3, Upstart had an application volume of nearly $13 billion, and with a conversion rate of 9.5%, its transaction volume was $1.2 billion. On the other hand, Pagaya evaluated applications worth more than $182 billion in Q3, and its network volume was $2.1 billion at a very low conversion rate of less than 1%. The difference in volume is simply incomparable. If Pagaya’s conversion rate increases once the macro conditions improve, its network volume could grow substantially which is why it might be better positioned to capitalize on any macro improvements in 2024. Risks It goes without saying that there are risks for any investment. The risk facing the bearish thesis on UPST stock is that since it is heavily impacted by macro conditions, its outlook may improve if the Fed starts cutting interest rates earlier than expected. Analysts expect this to happen in the second half of 2024, but if the upcoming CPI print shows that inflation is approaching the Fed’s 2% target, it could be a sign that rate cuts may be sooner than expected. As for the bullish thesis on Pagaya, the main risk would be competition. Currently, there’s no platform similar to Pagaya. However, if large banks invest more funds into developing AI software, it could limit its revenue growth potential as it mainly depends on attracting major banks that process a huge number of transactions. Technical Analysis On the hourly chart, UPST stock is in a neutral trend as it is in a sideways channel between $19.94 and $22.43. Looking at the indicators, the stock is below the 200, 50, and 21 MAs which is a bearish sign. Meanwhile, the RSI is neutral at 45 and the MACD is bullish. In terms of its fundamentals, UPST has been negatively impacted by the current macro conditions since it is dependent on loans originating from its platform. Therefore, the company reported underwhelming Q3 earnings in addition to slashing its guidance. Considering that the Fed is not expected to cut interest rates anytime soon, the company could continue suffering in the coming quarters from lower revenues and growing delinquencies which puts it a major credit risk since it holds around $1 billion of loans on its balance sheet. Based on this, investors could wait for the stock to test its $23 resistance. If the stock is unable to break this resistance, a good entry point for a short position could be between $23 and $22. PGY & UPST Forecast In summary, there is a misconception among investors that Pagaya and Upstart are competitors. As is, Upstart is mainly dependent on macro conditions as shown by its financial performance during this credit cycle. Meanwhile, Pagaya’s business model is more immune to macro conditions since it depends on its partners processing loans through its platform. Although both companies’ moat is their respective AI models, Pagaya’s is showing signs indicating that it is better performance-wise given the strong demand for its ABS compared to Upstart which shows that investors are more confident in Pagaya’s loans. Although improving macro conditions will benefit both companies, Pagaya has the potential to benefit more than Upstart due to its business model, which is why investors may find it profitable to go long on PGY stock and short on UPST stock.
NASDAQ:UPST
by Penny_Stocks_Today