Upstart Holdings Inc. (UPST) has received an optimistic view from JPMorgan, which has upgraded the stock’s rating to ‘Overweight’ from ‘Neutral,’ while trimming its price target to $88 from $93.
The upgrade reflects the firm's growing confidence in fintech lenders with more experience in the personal loan space, as stabilizing credit markets and expectations of lower interest rates create a more favorable backdrop for the sector, as per TheFly.
Upstart stock traded over 3% higher in Wednesday’s premarket. However, on Stocktwits, retail sentiment toward the stock shifted to ‘bearish’ from ‘neutral’ territory the previous day amid ‘low’ message volume levels.
A Stocktwits user sounded skeptical about the stock.
Despite lagging peers this year, Upstart stands out for its potential upside, the firm said. JPMorgan now sees an improved risk/reward profile for the company, which specializes in AI-powered personal loan approvals, compared to its competitors.
JPMorgan’s revised stance suggests growing institutional support for companies that combine technology with financial services expertise. Upstart’s AI-based lending platform helps connect borrowers with over 100 banks and credit unions. The technology allows lenders to approve more people at lower interest rates, and over 90% of loans through Upstart are processed automatically without any human involvement.
In the second quarter (Q2), Upstart’s revenue jumped 102% year-on-year to $257 million, beating the analysts’ consensus estimate of $225.4 million, as per FiscalAI data. Earnings per share (EPS) of $0.05 missed the consensus estimate of $0.25.
For the third quarter (Q3) and FY2025, the company sees a revenue of $280 million and $1.055 billion, against an estimate of $280.79 million and $1.057 billion, respectively.
Upstart stock has gained only 0.02% year-to-date and over 60% in the last 12 months.
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