Upstart (NASDAQ:UPST) Shares Gap Up - Here's Why

Key Points

• Upstart gapped up premarket—opened at $31.05 vs. the prior close of $29.53 and was trading around $31.49 on roughly 1.48M shares, about an 11% intraday move.
• Sentiment is mixed: a Zacks upgrade and bullish AI-focused coverage have boosted interest, but multiple class-action lawsuits alleging AI model calibration failures are the main downside risk and could impose legal, financial and reputational headwinds.
• Company fundamentals show momentum—quarterly revenue rose 35.2% with modest EPS and revenue beats—and the board authorized a $100M share buyback (≈3.2% of shares), though analysts remain divided with an average "Hold" rating.

Upstart Holdings, Inc. (NASDAQ:UPST - Get Free Report)'s stock price gapped up before the market opened on Wednesday . The stock had previously closed at $29.53, but opened at $31.05. Upstart shares last traded at $31.4860, with a volume of 1,483,940 shares.

More Upstart News

Here are the key news stories impacting Upstart this week:

• Positive Sentiment: Zacks upgraded UPST from "strong sell" to "hold," which can provide short-term analyst support and reduce immediate selling pressure. Zacks Upgrade
• Neutral Sentiment: Bullish coverage (The Motley Fool) has promoted Upstart’s AI-driven lending and a planned AI-powered bank as a transformative growth narrative; this is speculative and may attract retail interest but is not an immediate fundamental catalyst. Prediction: This AI Stock Is Going to Double
• Neutral Sentiment: Recent trading/coverage showed a modest uptick on Apr 13 as the stock trended on Zacks/Yahoo, indicating heightened investor interest that can amplify moves in either direction. Upstart Beats Stock Market Upswing (Yahoo)
• Negative Sentiment: A broad set of plaintiff law firms has announced class actions or solicitations for investors who bought UPST between May 14, 2025 and Nov 4, 2025, alleging securities law violations tied to purported failures in AI model calibration and related disclosures — these developments raise legal, financial and reputational risk and are the primary driver of downside pressure. Lead-plaintiff deadlines (commonly June 8, 2026 in these notices) and multiple firms (examples below) have amplified the story. Levi & Korsinsky Investor Alert Berger Montague Notice

Wall Street Analysts Forecast Growth

UPST has been the subject of a number of research analyst reports. Citigroup cut shares of Upstart from a "buy" rating to a "strong sell" rating in a research report on Friday, February 13th. Weiss Ratings reissued a "sell (d+)" rating on shares of Upstart in a research report on Friday, March 27th. Truist Financial decreased their price target on shares of Upstart from $59.00 to $49.00 and set a "buy" rating for the company in a research report on Wednesday, February 11th. Compass Point raised shares of Upstart from a "sell" rating to a "neutral" rating and raised their price target for the company from $20.00 to $30.00 in a research report on Tuesday, February 17th. Finally, Needham & Company LLC reissued a "buy" rating and issued a $40.00 price target on shares of Upstart in a research report on Wednesday, March 11th. Six investment analysts have rated the stock with a Buy rating, seven have assigned a Hold rating and three have given a Sell rating to the company. Based on data from MarketBeat.com, the company presently has an average rating of "Hold" and an average target price of $48.00.

Upstart Trading Up 11.1%

The stock's fifty day moving average price is $28.77 and its two-hundred day moving average price is $39.99. The firm has a market capitalization of $3.22 billion, a price-to-earnings ratio of 78.54, a price-to-earnings-growth ratio of 0.73 and a beta of 2.16.

Upstart (NASDAQ:UPST - Get Free Report) last announced its quarterly earnings data on Tuesday, February 10th. The company reported $0.17 earnings per share for the quarter, beating analysts' consensus estimates of $0.15 by $0.02. Upstart had a net margin of 5.13% and a return on equity of 6.30%. The business had revenue of $296.09 million for the quarter, compared to analyst estimates of $288.54 million. During the same period last year, the business earned $0.26 EPS. The company's revenue was up 35.2% on a year-over-year basis. Analysts anticipate that Upstart Holdings, Inc. will post -0.03 earnings per share for the current fiscal year.

Upstart announced that its Board of Directors has authorized a share buyback plan on Thursday, February 19th that permits the company to repurchase $100.00 million in outstanding shares. This repurchase authorization permits the company to repurchase up to 3.2% of its stock through open market purchases. Stock repurchase plans are often a sign that the company's management believes its shares are undervalued.

Insider Buying and Selling at Upstart

In other news, CFO Sanjay Datta sold 7,982 shares of the firm's stock in a transaction on Friday, February 20th. The shares were sold at an average price of $29.86, for a total value of $238,342.52. Following the sale, the chief financial officer directly owned 276,688 shares in the company, valued at approximately $8,261,903.68. This trade represents a 2.80% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. In the last quarter, insiders have sold 9,481 shares of company stock valued at $282,201. 16.67% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Upstart

Hedge funds and other institutional investors have recently bought and sold shares of the stock. Erste Asset Management GmbH acquired a new stake in Upstart during the 3rd quarter worth $4,237,000. Citigroup Inc. raised its stake in Upstart by 71.5% during the 3rd quarter. Citigroup Inc. now owns 550,138 shares of the company's stock worth $27,947,000 after acquiring an additional 229,315 shares in the last quarter. Connor Clark & Lunn Investment Management Ltd. raised its stake in Upstart by 31.5% during the 3rd quarter. Connor Clark & Lunn Investment Management Ltd. now owns 971,856 shares of the company's stock worth $49,370,000 after acquiring an additional 232,595 shares in the last quarter. Quantbot Technologies LP raised its stake in Upstart by 1,066.4% during the 3rd quarter. Quantbot Technologies LP now owns 147,316 shares of the company's stock worth $7,484,000 after acquiring an additional 134,686 shares in the last quarter. Finally, Neo Ivy Capital Management acquired a new stake in Upstart during the 3rd quarter worth $3,218,000. 63.01% of the stock is currently owned by institutional investors and hedge funds.

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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