Connor Clark & Lunn Investment Management Ltd. Buys 232,595 Shares of Upstart Holdings, Inc. $UPST

Key Points

• Connor Clark & Lunn Investment Management boosted its stake in Upstart by 31.5% in Q3, adding 232,595 shares to hold 971,856 shares (about 1.00% of the company) valued at roughly $49.37 million.
• Upstart plans to apply for a national bank charter, a move analysts say could materially expand net interest margin and long‑term profitability, but the approval timeline, regulatory/compliance costs and execution risk remain significant.
• The company’s Board authorized a $100 million share repurchase program (up to ~3.2% of shares), while recent developments — including a Pomerantz investor investigation and unusual put option activity — add near‑term legal and market risk.

Connor Clark & Lunn Investment Management Ltd. boosted its position in shares of Upstart Holdings, Inc. (NASDAQ:UPST - Free Report) by 31.5% in the third quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission. The institutional investor owned 971,856 shares of the company's stock after purchasing an additional 232,595 shares during the period. Connor Clark & Lunn Investment Management Ltd. owned about 1.00% of Upstart worth $49,370,000 at the end of the most recent reporting period.

Other hedge funds and other institutional investors have also recently modified their holdings of the company. Norges Bank acquired a new position in shares of Upstart during the second quarter worth about $67,777,000. Mane Global Capital Management LP acquired a new stake in Upstart in the 2nd quarter valued at approximately $43,576,000. Rokos Capital Management LLP bought a new stake in Upstart in the 2nd quarter valued at approximately $31,012,000. Citigroup Inc. lifted its stake in Upstart by 71.5% in the 3rd quarter. Citigroup Inc. now owns 550,138 shares of the company's stock valued at $27,947,000 after acquiring an additional 229,315 shares in the last quarter. Finally, Annex Advisory Services LLC acquired a new position in Upstart during the 3rd quarter worth approximately $10,520,000. Institutional investors and hedge funds own 63.01% of the company's stock.

Key Headlines Impacting Upstart

Here are the key news stories impacting Upstart this week:

• Positive Sentiment: Management announced plans to apply for a national bank charter — a strategic shift that could unlock lower cost deposits, materially expand net interest margin and de‑risk funding over time. Upstart to Apply for National Bank Charter
• Positive Sentiment: Analyses project large profitability upside if a bank charter is approved (estimated margin/EBITDA lift and multiple expansion akin to SoFi’s path), supporting a longer‑term bullish case for UPST. Upstart's SoFi Moment Is Here (Seeking Alpha)
• Positive Sentiment: Needham & Company reaffirmed a Buy rating with a $40 price target, signaling broker confidence in upside from the charter and model improvements (note: this reflects analyst optimism, not a guaranteed outcome).
• Neutral Sentiment: Market commentary highlights the charter as transformational but also emphasizes it will take time and carry regulatory/compliance costs — investors should watch the approval timeline and execution risk. Why Upstart’s Bank Charter Bet Could Change Everything (MarketBeat)
• Neutral Sentiment: Comparative analyses and market recaps are drawing attention to valuation and volatility; these pieces help frame risk/reward but don’t by themselves move fundamentals. Head to Head Analysis: Upstart vs. Virtu (AmericanBankingNews)
• Negative Sentiment: Pomerantz LLP launched an investor investigation into Upstart, a development that can increase legal risk, distract management and pressure the stock near term. Pomerantz Investigates Upstart (PR Newswire)
• Negative Sentiment: Unusual options activity: traders bought a large volume of put options (well above normal daily levels), signaling elevated short‑term bearish bets and hedging that can amplify downside moves.

Wall Street Analysts Forecast Growth

Several equities analysts have recently weighed in on the stock. Zacks Research cut shares of Upstart from a "hold" rating to a "strong sell" rating in a research note on Tuesday, February 17th. Weiss Ratings restated a "sell (d+)" rating on shares of Upstart in a report on Monday, December 29th. Citizens Jmp reaffirmed a "market underperform" rating and issued a $20.00 target price on shares of Upstart in a research report on Friday, February 13th. Needham & Company LLC reiterated a "buy" rating and issued a $40.00 price target on shares of Upstart in a research note on Wednesday. Finally, Compass Point raised shares of Upstart from a "sell" rating to a "neutral" rating and boosted their price target for the stock from $20.00 to $30.00 in a research report on Tuesday, February 17th. Four research analysts have rated the stock with a Buy rating, seven have issued a Hold rating and four have issued a Sell rating to the company's stock. According to MarketBeat.com, the stock presently has a consensus rating of "Hold" and a consensus target price of $48.17.

Upstart Stock Down 6.2%

Shares of Upstart stock opened at $25.76 on Friday. Upstart Holdings, Inc. has a 12-month low of $25.60 and a 12-month high of $87.30. The stock has a market cap of $2.53 billion, a P/E ratio of 61.33, a P/E/G ratio of 0.71 and a beta of 2.44. The business's 50 day moving average is $37.67 and its 200-day moving average is $46.72.

Upstart (NASDAQ:UPST - Get Free Report) last released its earnings results on Tuesday, February 10th. The company reported $0.17 earnings per share for the quarter, beating the consensus estimate of $0.15 by $0.02. The business had revenue of $296.09 million during the quarter, compared to analysts' expectations of $288.54 million. Upstart had a net margin of 5.13% and a return on equity of 6.30%. The firm's revenue was up 35.2% on a year-over-year basis. During the same period last year, the business earned $0.26 earnings per share. On average, sell-side analysts expect that Upstart Holdings, Inc. will post -0.03 EPS for the current year.

Upstart declared that its Board of Directors has authorized a share repurchase program on Thursday, February 19th that allows the company to buyback $100.00 million in outstanding shares. This buyback authorization allows the company to reacquire up to 3.2% of its shares through open market purchases. Shares buyback programs are usually an indication that the company's leadership believes its shares are undervalued.

Insider Activity at Upstart

In other news, CFO Sanjay Datta sold 7,982 shares of Upstart stock in a transaction dated Friday, February 20th. The shares were sold at an average price of $29.86, for a total value of $238,342.52. Following the completion of the transaction, the chief financial officer owned 276,688 shares of the company's stock, valued at $8,261,903.68. This trade represents a 2.80% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available at this link. Over the last ninety days, insiders have sold 9,481 shares of company stock valued at $282,201. Company insiders own 16.67% of the company's stock.

Upstart Company Profile

Upstart Holdings, Inc operates a cloud-based lending marketplace that leverages artificial intelligence and machine learning to assess borrower creditworthiness. The company partners with banks and credit unions, providing its proprietary AI models and underwriting platform to facilitate consumer credit products. By focusing on non‐traditional data points—such as education, employment history and other real‐time indicators—Upstart seeks to improve approval rates and lower loss rates compared with conventional credit scoring methods.

Upstart's core offering centers on unsecured personal loans, which borrowers can use for purposes such as debt consolidation, home improvements or major purchases.

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