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Monday, February 6, 2023

Upstart Holdings, Inc. (UPST) Stock on a Brisk Rise in Premarket, Here’s Why

Upstart Holdings, Inc. (UPST), a cloud-based AI platform, has rocketed 26.30% in premarket trading session and consequently is trading at $137.81 at the time of the writing. During Tuesday’s regular trading session, the stock gained an increase of 4.31% and closed the day at $109.11. The surge in premarket could be attributed to the announcement of outstanding quarterly results.

Q4 and FY2021 Results

On Tuesday, after the regular trading session came to an end, UPST announced the results for Q4 and FY2021. The total revenue for the quarter was $305 million, an increase of 252% when compared with Q4 2021. The income from operations during Q4 2021 was $60.4 million against $10.4 million for Q4 2020. The GAAP net income for the quarter was $58.9 million, or diluted EPS of $0.61). During the complete fiscal year 2021, the total revenue was $849 million, which depicted an increase of 264% when compared with the previous year. The GAAP net income for FY2021 was $135 million, or diluted EPS of $1.43.

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Financial Outlook for Q1 and FY2022

UPST also announced the financial outlook for Q1 and FY2022. The expected revenue for Q1 2022 lies in the range of $295 to $305 million. The net income expected for Q1 2022 lies in a range of $18 to $22 million. The adjusted EBITDA for the quarter is expected to be $56 to $58 billion. For fiscal 2022, the company expects to generate revenue of $1.4 billion, while the adjusted EBITDA for the fiscal year would be approximately 17%.

Executive Commentary UPST Management

Dave Girouard co-founder and CEO of UPST, while commenting on the development said that the quarter has proven to be an exuberant finish off a brilliant year for the company. The auto loan originations on the company’s platform are increasing at a brisk pace, thanks to the tireless efforts of every individual who is part of the company. Looking ahead, the auto loan originations will provide growth opportunities to the company for years to come.

Future Outlook for UPST

Looking towards what’s coming ahead, analysts believe that although UPST holds several positive technical signals at this point, they are not enough for it to be considered as a buy candidate. Hence, for the time being, the best strategy for the investors is to hold the stock.

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