Upstart Applies for Bank Charter, Transitioning to Lender Model
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 19 2026
0mins
Source: NASDAQ.COM
- Transition to Banking Model: Upstart has applied for a bank charter, intending to shift from a platform to a lending institution, a significant change that will enable it to lower funding costs and access deposits as a new revenue stream, thereby enhancing its position in a competitive market.
- Funding Cost Advantage: As a bank, Upstart will be able to obtain cheaper funds through deposits rather than relying on wholesale loan resales, which will provide greater operational flexibility and improve profitability in future operations.
- Intensifying Market Competition: Although Upstart's transformation may present new opportunities, the digital banking space is highly competitive, with companies like SoFi and Chime rapidly gaining traction, necessitating Upstart to find a unique market position to stand out.
- Poor Stock Performance: Upstart's stock has fallen 33% this year, and despite management's confidence in the transition, the market's lukewarm response to its latest quarterly earnings report indicates that its road to recovery remains long and complicated.
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Analyst Views on UPST
Wall Street analysts forecast UPST stock price to rise
13 Analyst Rating
7 Buy
4 Hold
2 Sell
Moderate Buy
Current: 32.360
Low
20.00
Averages
56.73
High
80.00
Current: 32.360
Low
20.00
Averages
56.73
High
80.00
About UPST
Upstart Holdings, Inc. is an artificial intelligence (AI) lending marketplace. The Company’s platform includes personal loans, automotive retail and refinance loans, home equity lines of credit (HELOCs), and small dollar loans. It applies artificial intelligence models and cloud applications to the process of underwriting consumer credit. Its AI marketplace connects consumers with its lending partner. Its consumers can access Upstart-powered loans via Upstart.com, through a lender-branded product on its lending partners’ own websites, and through auto dealerships that use its Upstart Auto Retail software. Its platform enables lenders provide a product their customers want, rather than letting customers seek loans from competitors. Its cloud-based software platform incorporates technologies and software development approaches to allow for development of new features, such as cloud-native technologies, data integrity and security, and configurable multi-tenant architecture, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Upstart Holdings Stock Fluctuations and Earnings Outlook
- Stock Performance: Upstart Holdings, Inc. (UPST) fell 4.06% to $30.50 in the latest session, underperforming the S&P 500's daily gain of 0.5%, indicating market caution regarding its short-term outlook.
- Monthly Growth: Despite the recent decline, UPST has increased by 7% over the past month, surpassing the Finance sector's gain of 1.89%, suggesting the company retains growth potential in a competitive market.
- Earnings Expectations: Upstart is forecasted to report an EPS of $0.55, reflecting a 52.78% increase from the prior year, with quarterly revenue expected to reach $354.89 million, up 37.93%, which could positively impact investor confidence.
- Valuation Analysis: Upstart's Forward P/E ratio stands at 14.02, significantly above the industry average of 10.68, while its PEG ratio of 0.34 indicates potential for future earnings growth, likely attracting investors seeking growth stocks.
See More
Upstart Leadership Changes and Price Target Adjustments
- Leadership Transition: Upstart announced a significant leadership change with co-founder and CTO Paul Gu becoming CEO on May 1, succeeding co-founder Dave Girouard, who will serve as Executive Chairman, indicating a long-term strategic succession plan within the company.
- Insider Trading Disclosure: President and Chief Capital Officer Sanjay Datta disclosed plans to sell 15,000 shares valued at approximately $456,000 in a Form 144 filing, alongside previous sales of 1,817 shares and 7,985 shares, reflecting a shift in executive confidence regarding the company's stock.
- Analyst Target Adjustments: Jefferies raised Upstart's price target from $27 to $30 while maintaining a 'Hold' rating, reflecting management's focus on core non-prime markets and new product developments, although this suggests a downside of about 3.4% from the stock's last close.
- Market Sentiment Analysis: Despite an 85% surge in message volume around Upstart stock in the past 24 hours, retail sentiment remains bearish, indicating cautious investor outlook as the stock has declined over 32% this year.
See More
Upstart Leadership Changes and Price Target Adjustments
- Leadership Transition: Upstart announced a significant leadership change with co-founder Paul Gu appointed as CEO effective May 1, succeeding co-founder Dave Girouard, who transitions to Executive Chairman, indicating a long-term strategic focus on succession planning within the company.
- Price Target Revision: Jefferies raised Upstart's price target from $27 to $30 while maintaining a 'Hold' rating, reflecting cautious optimism from analysts about the company's future, although this suggests a downside of approximately 3.4% from the stock's recent close.
- Stock Trading Dynamics: President and Chief Capital Officer Sanjay Datta disclosed plans to sell 15,000 shares valued at approximately $456,000, indicating a lack of confidence among executives regarding the company's stock, which raises market concerns about its future performance.
- Market Sentiment Analysis: Despite a surge of 85% in message volume around Upstart stock over the past 24 hours, retail investor sentiment remains in the 'bearish' territory, reflecting uncertainty about the company's future, particularly as its stock has declined over 32% this year.
See More
Upstart Holdings Sees Loan Growth Recovery Amid Challenges
- Loan Origination Growth: Upstart Holdings reported total loan originations of $3.4 billion in Q1, marking a 61% year-over-year increase, with transaction volumes up 77%, indicating a strong recovery in the AI lending market despite ongoing profitability challenges.
- Profitability Concerns: Despite revenue growth, Upstart faced an operating loss of $7.5 million and a net loss of $6.6 million, both significantly higher than the previous year's figures, highlighting the cost pressures and uncertainties in achieving profitability during its expansion phase.
- Future Guidance: The company reiterated its 2026 financial guidance, projecting revenues of $1.4 billion and adjusted EBITDA of $294 million, representing increases of 34% and 27.5% compared to 2025, reflecting management's confidence in future growth.
- Market Risks: With a short interest of 32% in Upstart's stock, market concerns about its profitability and growth trajectory are evident, prompting investors to exercise caution and consider waiting for price corrections or improvements in key risks before investing.
See More
Upstart Holdings Reports Strong Growth Amid Challenges
- Significant Revenue Growth: Upstart Holdings reported total originations of $3.4 billion in Q1, a 61% year-over-year increase, with transaction volumes up 77%, indicating a robust recovery despite a 92% decline from its peak stock price.
- Profitability Challenges: While the company has achieved consistent profitability, it reported an operating loss of $7.5 million in Q1, up from $4.5 million a year earlier, highlighting the need for improved cost management alongside revenue growth.
- Optimistic Future Outlook: Upstart reiterated its 2026 revenue guidance of $1.4 billion and adjusted EBITDA of $294 million, representing increases of 34% and 27.5% respectively compared to 2025, reflecting management's confidence in future growth.
- Market Risks Persist: Despite strong growth, Upstart's short interest remains high at 32%, indicating market uncertainty regarding its profitability trajectory, suggesting that investors should carefully assess its future earnings potential.
See More
Reminder of Class Action Lawsuit for Upstart Holdings Investors
- Class Action Notification: Rosen Law Firm reminds investors who purchased Upstart Holdings securities between May 14, 2025, and November 4, 2025, that they must apply to be lead plaintiff by June 8, 2026, to participate in the class action and seek compensation.
- Fee Arrangement: Investors joining the class action will not incur any upfront costs, as attorney fees will be covered through a contingency fee arrangement, significantly reducing financial risk for investors until compensation is secured.
- Lawsuit Background: The lawsuit alleges that Upstart Holdings made false and misleading statements during the class period, resulting in investor losses due to the overestimation of Model 22's risk-separation processes, which negatively impacted the company's revenue guidance.
- Law Firm's Advantage: Rosen Law Firm is recognized for its successful track record in securities class actions, having recovered over $438 million for investors in 2019 alone, demonstrating its expertise and resource advantages in handling such cases.
See More
Upstart Holdings Stock Fluctuations and Earnings Outlook
- Stock Performance: Upstart Holdings, Inc. (UPST) fell 4.06% to $30.50 in the latest session, underperforming the S&P 500's daily gain of 0.5%, indicating market caution regarding its short-term outlook.
- Monthly Growth: Despite the recent decline, UPST has increased by 7% over the past month, surpassing the Finance sector's gain of 1.89%, suggesting the company retains growth potential in a competitive market.
- Earnings Expectations: Upstart is forecasted to report an EPS of $0.55, reflecting a 52.78% increase from the prior year, with quarterly revenue expected to reach $354.89 million, up 37.93%, which could positively impact investor confidence.
- Valuation Analysis: Upstart's Forward P/E ratio stands at 14.02, significantly above the industry average of 10.68, while its PEG ratio of 0.34 indicates potential for future earnings growth, likely attracting investors seeking growth stocks.
See More
Upstart Leadership Changes and Price Target Adjustments
- Leadership Transition: Upstart announced a significant leadership change with co-founder and CTO Paul Gu becoming CEO on May 1, succeeding co-founder Dave Girouard, who will serve as Executive Chairman, indicating a long-term strategic succession plan within the company.
- Insider Trading Disclosure: President and Chief Capital Officer Sanjay Datta disclosed plans to sell 15,000 shares valued at approximately $456,000 in a Form 144 filing, alongside previous sales of 1,817 shares and 7,985 shares, reflecting a shift in executive confidence regarding the company's stock.
- Analyst Target Adjustments: Jefferies raised Upstart's price target from $27 to $30 while maintaining a 'Hold' rating, reflecting management's focus on core non-prime markets and new product developments, although this suggests a downside of about 3.4% from the stock's last close.
- Market Sentiment Analysis: Despite an 85% surge in message volume around Upstart stock in the past 24 hours, retail sentiment remains bearish, indicating cautious investor outlook as the stock has declined over 32% this year.
See More
Upstart Leadership Changes and Price Target Adjustments
- Leadership Transition: Upstart announced a significant leadership change with co-founder Paul Gu appointed as CEO effective May 1, succeeding co-founder Dave Girouard, who transitions to Executive Chairman, indicating a long-term strategic focus on succession planning within the company.
- Price Target Revision: Jefferies raised Upstart's price target from $27 to $30 while maintaining a 'Hold' rating, reflecting cautious optimism from analysts about the company's future, although this suggests a downside of approximately 3.4% from the stock's recent close.
- Stock Trading Dynamics: President and Chief Capital Officer Sanjay Datta disclosed plans to sell 15,000 shares valued at approximately $456,000, indicating a lack of confidence among executives regarding the company's stock, which raises market concerns about its future performance.
- Market Sentiment Analysis: Despite a surge of 85% in message volume around Upstart stock over the past 24 hours, retail investor sentiment remains in the 'bearish' territory, reflecting uncertainty about the company's future, particularly as its stock has declined over 32% this year.
See More
Upstart Holdings Sees Loan Growth Recovery Amid Challenges
- Loan Origination Growth: Upstart Holdings reported total loan originations of $3.4 billion in Q1, marking a 61% year-over-year increase, with transaction volumes up 77%, indicating a strong recovery in the AI lending market despite ongoing profitability challenges.
- Profitability Concerns: Despite revenue growth, Upstart faced an operating loss of $7.5 million and a net loss of $6.6 million, both significantly higher than the previous year's figures, highlighting the cost pressures and uncertainties in achieving profitability during its expansion phase.
- Future Guidance: The company reiterated its 2026 financial guidance, projecting revenues of $1.4 billion and adjusted EBITDA of $294 million, representing increases of 34% and 27.5% compared to 2025, reflecting management's confidence in future growth.
- Market Risks: With a short interest of 32% in Upstart's stock, market concerns about its profitability and growth trajectory are evident, prompting investors to exercise caution and consider waiting for price corrections or improvements in key risks before investing.
See More
Upstart Holdings Reports Strong Growth Amid Challenges
- Significant Revenue Growth: Upstart Holdings reported total originations of $3.4 billion in Q1, a 61% year-over-year increase, with transaction volumes up 77%, indicating a robust recovery despite a 92% decline from its peak stock price.
- Profitability Challenges: While the company has achieved consistent profitability, it reported an operating loss of $7.5 million in Q1, up from $4.5 million a year earlier, highlighting the need for improved cost management alongside revenue growth.
- Optimistic Future Outlook: Upstart reiterated its 2026 revenue guidance of $1.4 billion and adjusted EBITDA of $294 million, representing increases of 34% and 27.5% respectively compared to 2025, reflecting management's confidence in future growth.
- Market Risks Persist: Despite strong growth, Upstart's short interest remains high at 32%, indicating market uncertainty regarding its profitability trajectory, suggesting that investors should carefully assess its future earnings potential.
See More
Reminder of Class Action Lawsuit for Upstart Holdings Investors
- Class Action Notification: Rosen Law Firm reminds investors who purchased Upstart Holdings securities between May 14, 2025, and November 4, 2025, that they must apply to be lead plaintiff by June 8, 2026, to participate in the class action and seek compensation.
- Fee Arrangement: Investors joining the class action will not incur any upfront costs, as attorney fees will be covered through a contingency fee arrangement, significantly reducing financial risk for investors until compensation is secured.
- Lawsuit Background: The lawsuit alleges that Upstart Holdings made false and misleading statements during the class period, resulting in investor losses due to the overestimation of Model 22's risk-separation processes, which negatively impacted the company's revenue guidance.
- Law Firm's Advantage: Rosen Law Firm is recognized for its successful track record in securities class actions, having recovered over $438 million for investors in 2019 alone, demonstrating its expertise and resource advantages in handling such cases.
See More
