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

Key Points

• $1.2 billion multi‑year forward‑flow agreement with Centerbridge to buy consumer loans originated on Upstart’s platform expands loan‑sale capacity, boosts revenue visibility and reduces balance‑sheet funding risk — the deal (alongside a $100 million share buyback authorization) helped drive the premarket gap up.
• Litigation risk has intensified as multiple securities suits — including a Pomerantz class action and a Levi & Korsinsky complaint naming the CTO — raise the prospects of legal costs, management distraction and headline‑driven downside.
• Wall Street remains divided: the consensus rating is Hold with an average target of $48, while valuation and technicals (market cap ≈ $3.3B, P/E ≈ 82, 50‑day vs. 200‑day moving averages) signal both growth expectations and elevated volatility.

Upstart Holdings, Inc. (NASDAQ:UPST - Get Free Report) shares gapped up before the market opened on Wednesday . The stock had previously closed at $33.20, but opened at $35.06. Upstart shares last traded at $34.7480, with a volume of 503,380 shares.

More Upstart News

Here are the key news stories impacting Upstart this week:

• Positive Sentiment: Upstart announced a multi‑year forward‑flow commitment from funds managed by Centerbridge to buy up to $1.2 billion of consumer loans originated on the Upstart platform — this expands loan sale capacity, supports revenue visibility and reduces balance‑sheet funding risk. Upstart Announces Multi-Year $1.2B Forward-Flow Agreement with Centerbridge Partners, L.P.
• Neutral Sentiment: Analyst and stock commentary is mixed — Bank of America recently trimmed its price target (from $40 to $36) but stayed Neutral, reflecting tempered near‑term expectations even as some commentators speculate longer‑term upside. Can Upstart Holdings (UPST) Double in the Next 5 Years?
• Negative Sentiment: Litigation risk has intensified: a class action has been filed (Pomerantz) and Levi & Korsinsky’s notice names CTO Paul Gu as a defendant in a securities suit covering the May–Nov 2025 period — this creates potential legal costs, management distraction and downside uncertainty. Pomerantz Law Firm Announces the Filing of a Class Action Against Upstart Holdings, Inc. and Certain Officers – UPST UPST Investor Alert: Upstart Holdings Securities Fraud Lawsuit - Levi & Korsinsky
• Negative Sentiment: Numerous plaintiff firms (Rosen, Bernstein Liebhard, Schall, Faruqi, Gross, Robbins, Bronstein, etc.) are actively soliciting clients and reminding investors of lead‑plaintiff deadlines — this amplifies headline risk and could accelerate settlement pressure or discovery costs. ROSEN, A TRUSTED INVESTOR RIGHTS FIRM Encourages Upstart Holdings, Inc. Investors to Secure Counsel Before Important Deadline in Securities Class Action - UPST

Wall Street Analyst Weigh In

UPST has been the subject of several recent analyst reports. Zacks Research raised shares of Upstart from a "strong sell" rating to a "hold" rating in a research note on Monday, April 13th. Weiss Ratings reaffirmed a "sell (d+)" rating on shares of Upstart in a research note on Friday, March 27th. Compass Point raised shares of Upstart from a "sell" rating to a "neutral" rating and upped their target price for the company from $20.00 to $30.00 in a research note on Tuesday, February 17th. Mizuho lowered their target price on shares of Upstart from $66.00 to $51.00 and set an "outperform" rating for the company in a research note on Thursday, March 26th. Finally, Needham & Company LLC reaffirmed a "buy" rating and issued a $40.00 target price on shares of Upstart in a research note on Wednesday, March 11th. Six research analysts have rated the stock with a Buy rating, seven have given a Hold rating and three have issued a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of "Hold" and an average target price of $48.00.

Upstart Price Performance

The stock has a market cap of $3.29 billion, a P/E ratio of 81.94, a P/E/G ratio of 0.98 and a beta of 2.16. The company's 50 day simple moving average is $28.38 and its 200 day simple moving average is $39.34.

Upstart (NASDAQ:UPST - Get Free Report) last issued its quarterly earnings data on Tuesday, February 10th. The company reported $0.17 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.15 by $0.02. Upstart had a net margin of 5.13% and a return on equity of 6.30%. The company had revenue of $296.09 million during the quarter, compared to the consensus estimate of $288.54 million. During the same quarter in the prior year, the firm earned $0.26 earnings per share. The firm's revenue was up 35.2% compared to the same quarter last year. On average, equities research analysts predict that Upstart Holdings, Inc. will post 0.94 earnings per share for the current year.

Upstart announced that its Board of Directors has initiated a stock buyback program on Thursday, February 19th that authorizes the company to buyback $100.00 million in shares. This buyback authorization authorizes the company to buy up to 3.2% of its shares through open market purchases. Shares buyback programs are usually a sign that the company's leadership believes its shares are undervalued.

Insider Activity

In other news, CFO Sanjay Datta sold 7,982 shares of the stock in a transaction on Friday, February 20th. The shares were sold at an average price of $29.86, for a total transaction of $238,342.52. Following the completion of the sale, the chief financial officer owned 276,688 shares of the company's stock, valued at $8,261,903.68. This represents a 2.80% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. Insiders have sold a total of 9,481 shares of company stock worth $282,201 over the last ninety days. 16.67% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Upstart

Several large investors have recently made changes to their positions in the stock. AQR Capital Management LLC boosted its holdings in Upstart by 89.5% during the first quarter. AQR Capital Management LLC now owns 96,706 shares of the company's stock worth $4,451,000 after purchasing an additional 45,664 shares during the last quarter. Integrated Wealth Concepts LLC boosted its holdings in Upstart by 13.8% during the first quarter. Integrated Wealth Concepts LLC now owns 4,628 shares of the company's stock worth $213,000 after purchasing an additional 563 shares during the last quarter. NewEdge Advisors LLC boosted its holdings in Upstart by 20.0% during the first quarter. NewEdge Advisors LLC now owns 1,997 shares of the company's stock worth $92,000 after purchasing an additional 333 shares during the last quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its holdings in Upstart by 18.7% during the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 173,017 shares of the company's stock worth $7,964,000 after purchasing an additional 27,287 shares during the last quarter. Finally, Acadian Asset Management LLC acquired a new position in Upstart during the first quarter worth $208,000. Institutional investors own 63.01% of the company's stock.

About Upstart

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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