Upstart Holdings (UPST) AI Stock Analysis

• Market Cap: $6.63B
• Dividend Yield: N/A
• Average Volume (3M): 6.97M
• Price to Earnings (P/E): ―
• Beta (1Y): 3.62
• Revenue Growth: 60.62%
• EPS Growth: 96.91%
• Country: US
• Employees: 1,193
• Sector: Financial
• Sector Strength: 72
• Industry: Financial - Credit Services
• EPS (TTM): 0.36
• Shares Outstanding: 96,217,740
• 10 Day Avg. Volume: 7,052,797
• 30 Day Avg. Volume: 6,967,713
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.13
• Enterprise Value/Revenue: 8.80
• Enterprise Value/Gross Profit: 8.93
• Enterprise Value/Ebitda: -1.23K
• 1Y Price Target: $70.11
• Price Target Upside: 1.39% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 11

• Rating: 49 Neutral
• Price Target: $69.00 ▼(-0.22% Downside)

Upstart Holdings' overall score is driven by strong earnings call results, indicating a return to growth and profitability. However, financial performance and valuation metrics are weak, reflecting ongoing challenges with profitability, cash flow, and high leverage.

Positive Factors

Financial Performance

UPST posted strong 2Q results, as estimates came in well above Street expectations on the top and bottom line.

Profitability

UPST is returning to profitability and this is expected to continue prospectively, which is likely to increase its value for investors.

User Growth

Website traffic to upstart.com, monthly active users of the UPST app, and Trustpilot reviews for UPST all showed strong y/y increases, up 22%/144%/180% respectively.

Negative Factors

Guidance Concerns

Shares are trading lower due to high expectations not being fully met.

Revenue Risks

A key risk in 2Q (and the outlook) is that loan originations are strong but take rates compress which drives revenue below expectations.

Take Rate Pressure

Take rate continued to decline, which was a concern despite being slightly better than forecast.

Upstart Holdings Business Overview & Revenue Model

Company Description

Upstart Holdings, Inc. is a financial technology company that leverages artificial intelligence and machine learning to provide personal loans and credit services. The company operates primarily in the financial services sector, offering a platform that connects consumers with partner banks and credit unions to obtain affordable credit. Upstart aims to improve access to credit and reduce the risk of lending through its innovative underwriting model that goes beyond traditional credit scores.

How the Company Makes Money

Upstart Holdings makes money by charging fees to its banking and credit union partners for originating loans through its platform. The company earns revenue from referral fees each time a loan is originated and from platform fees for loans originated by its bank partners. Additionally, Upstart generates revenue through servicing fees, which are collected for managing loans on behalf of their partners. The company's AI-driven model allows it to assess risk more accurately, potentially leading to lower default rates and better terms for borrowers, which enhances its attractiveness to lenders and helps drive its revenue streams. Upstart's significant partnerships with various financial institutions enable it to scale its operations and reach a broader consumer base.

Upstart Holdings Financial Statement Overview

Summary

Upstart Holdings is showing positive revenue growth and improvements in cash flow management. However, profitability remains a challenge with negative margins and high financial leverage, posing potential risks.

Income Statement

Upstart Holdings has shown a positive revenue growth of 14.7% TTM, indicating a recovery from previous periods. However, the company continues to face profitability challenges, with a negative EBIT margin of -14.9% TTM and net profit margin of -9.2% TTM, reflecting ongoing operational losses.

Balance Sheet

The company's debt-to-equity ratio is relatively high at 2.04, indicating leveraged financial structure which could be risky in a volatile market. However, the equity ratio of 29.5% reflects a stable asset base. Return on equity is negative due to net losses, posing a challenge to value generation for shareholders.

Cash Flow

Upstart Holdings demonstrates a substantial improvement in cash flows, with a positive operating cash flow to net income ratio of 1.81 TTM. Free cash flow has also improved, suggesting efficient capital management despite negative free cash flow to net income ratio due to net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	851.09M	628.83M	508.12M	837.76M	846.61M	222.05M
Gross Profit	838.23M	628.83M	508.12M	837.76M	846.61M	222.05M
EBITDA	-6.08M	-111.87M	-196.73M	-89.51M	152.93M	22.07M
Net Income	-6.35M	-128.58M	-240.13M	-108.67M	135.44M	5.98M
Balance Sheet
Total Assets	2.48B	2.37B	2.02B	1.94B	1.82B	477.25M
Cash, Cash Equivalents and Short-Term Investments	400.56M	793.61M	368.40M	422.41M	986.61M	250.82M
Total Debt	1.47B	1.54B	1.23B	1.09B	795.80M	82.06M
Total Liabilities	1.76B	1.73B	1.38B	1.26B	1.01B	177.00M
Stockholders Equity	722.01M	633.22M	635.30M	672.43M	807.08M	300.25M
Cash Flow
Free Cash Flow	-71.26M	185.49M	-172.58M	-697.59M	153.24M	10.09M
Operating Cash Flow	-65.23M	186.33M	-160.49M	-674.68M	168.35M	15.70M
Investing Cash Flow	-312.48M	-237.73M	-118.45M	-114.13M	-143.88M	136.52M
Financing Cash Flow	471.31M	559.87M	214.27M	130.03M	855.43M	79.05M

Upstart Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 69.15
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UPST, the sentiment is Positive. The current price of 69.15 is below the 20-day moving average (MA) of 69.21, below the 50-day MA of 71.37, and above the 200-day MA of 62.40, indicating a neutral trend. The MACD of -1.54 indicates Negative momentum. The RSI at 50.38 is Neutral, neither overbought nor oversold. The STOCH value of 81.03 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UPST.

Upstart Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
YRD	76 Outperform	$519.30M	3.00	13.64%	6.62%	12.69%	-35.36%
OMF	76 Outperform	$7.27B	10.88	20.47%	6.78%	9.41%	13.98%
WU	72 Outperform	$2.77B	3.19	135.32%	10.99%	-3.83%	62.05%
WRLD	69 Neutral	$947.89M	11.74	19.08%	―	0.77%	12.08%
LC	69 Neutral	$1.90B	25.83	5.50%	―	7.54%	70.26%
Sector *	68 Neutral	$17.84B	12.03	10.32%	3.73%	9.70%	0.76%
UPST	49 Neutral	$6.63B	―	-0.96%	―	60.62%	96.91%

Upstart Holdings Corporate Events

Upstart Holdings Issues $690M Convertible Notes

On August 14, 2025, Upstart Holdings issued $690 million in 0% Convertible Senior Notes due 2032. The issuance aims to manage existing debt and fund general corporate purposes. The company also engaged in capped call transactions to mitigate potential stock dilution. The notes, which are senior unsecured obligations, offer conversion options under specific conditions and have implications for the company’s financial strategy and market positioning.

Upstart Holdings Stockholders Meeting Confirms Key Decisions

Upstart Holdings, Inc. held its annual meeting of stockholders on May 23, 2025, where key decisions were made regarding the company’s governance and operations. The stockholders elected Class II directors to serve until 2028, ratified the appointment of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025, and approved the compensation of the company’s named executive officers. These decisions are pivotal for Upstart Holdings as they ensure continuity in leadership and oversight, while also affirming the company’s financial management strategies.