Mihir Bhatia, an analyst from Bank of America Securities, reiterated the Hold rating on Upstart Holdings. The associated price target was raised to $88.00.
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Mihir Bhatia has given his Hold rating due to a combination of factors affecting Upstart Holdings. While the company is expected to report strong results for the second quarter, with performance metrics surpassing market expectations, the valuation of the stock has already seen a significant increase. The forward price-to-earnings ratio has risen substantially, suggesting that the stock might be priced at a level where further upside could be limited.
Another concern is the uncertainty surrounding take rates, which are crucial for Upstart’s revenue per loan. Although loan originations appear robust, any compression in take rates could negatively impact earnings, as seen in the previous quarter. Despite these challenges, Upstart continues to attract new partners, indicating sustained interest in its platform. However, risks such as weaker consumer credit and potential funding pullbacks remain, making the risk/reward profile balanced and justifying the Hold rating.
In another report released on July 24, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $92.00 price target.
Based on the recent corporate insider activity of 148 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of UPST in relation to earlier this year.