Upbound Group (UPBD) AI Stock Analysis

• Market Cap: $1.00B
• Dividend Yield: 8.88%
• Average Volume (3M): 815.42K
• Price to Earnings (P/E): 13.5
• Beta (1Y): 1.31
• Revenue Growth: 7.48%
• EPS Growth: 2.05%
• Country: US
• Employees: 11,970
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 1.01
• Shares Outstanding: 58,117,603
• 10 Day Avg. Volume: 909,096
• 30 Day Avg. Volume: 815,416
• PEG Ratio: -0.32
• Price to Book (P/B): 1.43
• Price to Sales (P/S): 0.21
• P/FCF Ratio: 4.15
• Enterprise Value/Market Cap: 2.72
• Enterprise Value/Revenue: 0.58
• Enterprise Value/Gross Profit: 1.29
• Enterprise Value/Ebitda: 2.71
• 1Y Price Target: $33.00
• Price Target Upside: 91.64% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 4.2
• Revenue Forecast (FY): $4.88B

• Rating: 61 Neutral
• Price Target: $18.00 ▲(4.53% Upside)
• Action: Reiterated Date: 02/23/26
• Date: Action: Reiterated 02/23/26

Overall score reflects a balanced setup: improving cash generation and constructive 2026 guidance support the outlook, but thin profitability and elevated leverage are meaningful constraints. Technicals are positive but appear somewhat overextended, while valuation/dividend yield are supportive.

Positive Factors

Improved cash generation

TTM free cash flow and operating cash flow turned meaningfully positive, with free cash flow rising to about $180M and operating cash flow to ~$306M in 2025. Stronger cash conversion supports sustained investment in underwriting, tech, and deleveraging, improving long-term financial flexibility and funding capacity without relying solely on external capital.

Record and accelerating revenue

Sustained top-line growth to a record $4.7B reflects broad-based momentum across Rent‑A‑Center, Acima and Bridget. Durable revenue scale reduces per-unit fixed costs, strengthens bargaining power with partners and suppliers, and provides a firmer base to absorb execution variability while funding margin or product investments over the next several quarters.

High-growth digital product (Bridget)

Bridget's rapid subscriber and revenue growth creates a recurring revenue stream with improving ARPU and positive EBITDA contribution. Its scale and digital-first model diversify Upbound's revenue mix away from legacy leasing, enabling higher-margin growth, cross-sell opportunities, and long-term margin expansion if loss rates remain controlled.

Negative Factors

Elevated leverage

A debt-heavy capital structure (net leverage near ~2.9x at year-end) constrains strategic optionality, increases refinancing and interest-rate sensitivity, and forces prioritization of deleveraging over growth or buybacks. High leverage reduces resilience to macro shocks and limits capacity for opportunistic investments over the next 2–6 months.

Thin profitability and margin compression

Despite revenue growth and solid gross margins (~45%), operating and net margins remain compressed and volatile. Low profitability limits retained earnings for reinvestment, heightens sensitivity to credit losses and cost inflation, and means modest shocks could materially erode earnings and cash generation over the medium term.

Elevated loss rates and underwriting risk

Persistently higher loss rates at Acima and rising losses in Bridget indicate underwriting vintage risk that can depress margins and require tighter approvals. Tighter underwriting to control losses will likely restrict GMV and revenue growth, delaying margin recovery and increasing the challenge of scaling higher-margin digital products sustainably.

Upbound Group Business Overview & Revenue Model

Company Description

Upbound Group, Inc., an omni-channel platform company, leases household durable goods to customers on a lease-to-own basis in the United States, Puerto Rico, and Mexico. The company operates in four segments: Rent-A-Center Business, Acima, Mexico, and Franchising. The company's brands, such as Rent-A-Center and Acima that facilitate consumer transactions across a range of store-based and virtual channels. It offers furniture comprising mattresses, tires, consumer electronics, appliances, tools, handbags, computers, smartphones, and accessories. The company also provides merchandise on an installment sales basis; and the lease-to-own transaction to consumers who do not qualify for financing from the traditional retailer through kiosks located within retailer's locations. It operates retail installment sales stores under the Get It Now and Home Choice names; lease-to-own and franchised lease-to-own stores under the Rent-A-Centre, ColorTyme, and RimTyme names; and company-owned stores and e-commerce platform through rentacenter.com. The company was formerly known as Rent-A-Center, Inc. and changed its name to Upbound Group, Inc. in February 2023. Upbound Group, Inc. was founded in 1960 and is headquartered in Plano, Texas.

How the Company Makes Money

Upbound Group makes money primarily by earning revenue from lease-to-own and point-of-sale lease/financing transactions that allow customers to obtain merchandise while paying over time. Under the Rent-A-Center model, the company acquires (or sources) merchandise and provides it to customers under lease-to-own agreements; revenue is recognized from customer payments over the lease term, and earnings are influenced by factors such as merchandise margins, customer payment behavior, renewals, early purchase options, and credit/collection performance. Through Acima, the company generates revenue by facilitating lease-to-own options for consumers at third-party retail partners (including e-commerce and in-store channels); economics typically come from amounts paid by customers over time relative to the company’s cost to acquire the merchandise and/or amounts remitted to retail partners, with performance driven by partner volume, approval/underwriting outcomes, and customer repayment. Additional contributing factors can include fees or other income associated with these programs and the scale of the company’s retail and partner networks; specific fee structures or partner terms are not available (null).

Upbound Group Financial Statement Overview

Summary

Mixed fundamentals: strong TTM revenue acceleration and improved free cash flow/operating cash flow, but profitability remains thin (low net margin and compressed operating margin) and leverage is elevated (high debt-to-equity), limiting flexibility.

Income Statement

TTM (Trailing-Twelve-Months) revenue accelerated sharply versus recent years, and gross margin remains solid (~45%). However, profitability is thin: net margin is low (~1.6%) and down from 2024, while operating margin also compressed, indicating higher costs and weaker earnings conversion despite top-line growth. Results show improvement from the near-breakeven/negative earnings period in 2022–2023, but current earnings quality remains modest.

Balance Sheet

Leverage is elevated with debt running well above equity (debt-to-equity ~2.4x in TTM), which reduces financial flexibility and raises refinancing/interest-rate sensitivity. Equity has improved versus earlier periods, and return on equity in TTM is positive (~10.7%), but it is meaningfully below 2024 levels and the capital structure remains the key constraint.

Cash Flow

Cash generation improved materially: TTM free cash flow and operating cash flow are both positive and sharply higher than 2024, with free cash flow nearly matching net income (strong cash conversion). The main drawback is that operating cash flow still does not fully cover EBIT in TTM (coverage below 1), suggesting cash generation is good but not yet consistently strong relative to operating profit.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	4.70B	4.32B	3.99B	4.25B	4.58B
Gross Profit	1.62B	2.08B	2.02B	2.08B	2.24B
EBITDA	273.03M	339.01M	290.54M	283.05M	435.01M
Net Income	73.24M	123.48M	-5.18M	12.36M	134.94M
Balance Sheet
Total Assets	3.28B	2.65B	2.72B	2.76B	2.99B
Cash, Cash Equivalents and Short-Term Investments	120.53M	60.86M	93.70M	144.14M	108.33M
Total Debt	1.86B	1.58B	1.60B	1.67B	1.87B
Total Liabilities	2.58B	2.02B	2.16B	2.24B	2.48B
Stockholders Equity	695.74M	628.98M	560.37M	525.15M	513.28M
Cash Flow
Free Cash Flow	238.71M	48.45M	146.89M	407.07M	329.85M
Operating Cash Flow	305.57M	104.72M	200.29M	468.46M	392.30M
Investing Cash Flow	-403.73M	-41.51M	-50.96M	-62.33M	-1.34B
Financing Cash Flow	156.47M	-93.52M	-202.12M	-370.71M	892.85M

Upbound Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 17.22
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UPBD, the sentiment is Negative. The current price of 17.22 is below the 20-day moving average (MA) of 19.84, below the 50-day MA of 19.80, and below the 200-day MA of 21.16, indicating a bearish trend. The MACD of -0.72 indicates Positive momentum. The RSI at 31.96 is Neutral, neither overbought nor oversold. The STOCH value of 11.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for UPBD.

Upbound Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KARO	79 Outperform	$1.45B	22.71	31.88%	2.66%	18.30%	22.19%
SEMR	67 Neutral	$1.80B	―	-6.73%	―	19.87%	-136.93%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
UPBD	61 Neutral	$1.00B	13.54	10.66%	8.88%	7.48%	2.05%
AMPL	61 Neutral	$964.17M	-17.26	-32.90%	―	12.78%	-20.47%
PRCH	56 Neutral	$789.75M	61.80	-13.21%	―	-2.13%	―

Upbound Group Corporate Events

Upbound Group Posts Strong 2025 Results, Sets 2026 Outlook

On February 19, 2026, Upbound Group reported its fourth-quarter and full-year 2025 results, highlighting 11% year-over-year consolidated revenue growth to $1.2 billion and strong performance across its key brands. Acima delivered its ninth consecutive quarter of gross merchandise volume and revenue growth with a 9% revenue increase, while Brigit generated $65 million of revenue supported by about 1.6 million paying subscribers and nearly 10% growth in average revenue per user.

The Rent-A-Center business showed signs of stabilization, with same-store sales up 0.8% and a modest improvement in lease charge-off rates, and the company’s operating cash flow rose to $42 million, more than $100 million higher than a year earlier, underscoring improving cash generation. Upbound also introduced its 2026 outlook, projecting consolidated revenue between $4.7 billion and $4.95 billion and adjusted EBITDA of $500 million to $535 million, signaling continued growth ambitions and providing investors with clearer visibility into its expected financial trajectory.

The most recent analyst rating on (UPBD) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on Upbound Group stock, see the UPBD Stock Forecast page.