Latest news with #Upstart
Yahoo
3 days ago
- Business
- Yahoo
2 Artificial Intelligence (AI) Stocks (Besides Nvidia) to Buy Hand Over Fist for the Long Term
Nvidia has become one of the world's largest companies thanks to AI, but it isn't the only opportunity. and Upstart are AI software powerhouses with rapidly growing businesses and addressable markets. Shares of both are down sharply from their all-time highs, so this could be a great time to invest in them. 10 stocks we like better than › Nvidia supplies the best data center chips for artificial intelligence (AI) development, and with a market capitalization of $3.6 trillion, it's now one of the largest companies in the world. There is still room for its stock to move higher, but investors who already own it might be looking for other AI names with growth potential. (NYSE: AI) developed a portfolio of over 130 ready-made applications to help businesses accelerate their adoption of AI. Upstart Holdings (NASDAQ: UPST), on the other hand, created an AI-powered lending algorithm that helps banks assess the creditworthiness of potential borrowers far more effectively than traditional methods. Both companies have rapidly growing businesses and enormous addressable markets, so here's why it might be a great idea for investors to add and Upstart to their portfolios for the long term. Very few companies have the financial resources or the technical expertise to develop AI software from scratch, so they are turning to third-party vendors like to meet their needs. can deliver a custom AI application to a business customer in as little as three months from the initial project briefing, whether they operate in financial services, retail, manufacturing, oil and gas, or a host of other industries. also stepped into agentic AI recently. It developed a platform that allows businesses to create and deploy virtual assistants into their operations to analyze data, automate workflows, and even influence key decisions. The platform connects to over 200 third-party databases and software applications so businesses can tap into their most valuable data to extract the most out of their AI agents. Salesforce CEO Mark Benioff says the market for "digital labor" -- or agents -- could be as large as $12 trillion in the future, so might be on the cusp of the biggest financial opportunity in its history thanks to its agentic platform. Businesses can access products through leading cloud providers like Amazon Web Services, Microsoft Azure, and Alphabet's Google Cloud. They can scale software using the computing capacity on offer from those cloud providers, so they don't have to bear the enormous cost of maintaining their own infrastructure. is building some serious momentum right now. The company generated a record $389.1 million in revenue during its fiscal 2025 (which ended on April 30), representing an increase of 25% compared to the prior year. That growth rate accelerated for the second straight year. Shares of are down 85% from their record high, which was set during the tech frenzy in 2020. The stock was unquestionably overvalued back then with its price-to-sales (P/S) ratio soaring to around 80, but it has since come down to a more reasonable level of 7.8. In fact, that's a 19% discount to its three-year average of 9.7 (which excludes the expensive 2021 period), so the stock might actually be undervalued now: The combination of momentum, its sizable market opportunity in areas like agentic AI, and its valuation creates a compelling opportunity for investors. Upstart thinks traditional human-led methods for assessing the creditworthiness of potential borrowers are outdated, partly because they center around Fair Isaac's FICO credit scoring system, which only considers a handful of metrics like a person's outstanding debts and their repayment history. The company's AI algorithm analyzes over 2,500 data points for every applicant to gain a better understanding of their creditworthiness. In fact, it's currently so good that it approves twice as many loans at a much lower average interest rate compared to traditional assessment methods -- all while maintaining a comparable risk profile. Plus, 92% of Upstart's approvals are now fully automated, so applicants don't have to wait around for lengthy human assessment processes. Upstart earns a fee each time its platform originates a loan on behalf of its bank partners. The company specializes in unsecured personal loans, but it has a growing presence in car loans and home equity lines of credit (HELOCs). There is still plenty of room for expansion into other segments like business loans, industrial loans, and credit cards over the long term. CEO Dave Girouard says $25 trillion worth of loans are originated worldwide each year across all segments, creating $1 trillion in fee revenue. He thinks all credit assessment processes will be handled by AI within the next decade, so Upstart is in a great position to capitalize on the enormous opportunity ahead. During the first quarter of 2025 (ended March 31), Upstart generated $213 million in total revenue, which was a 67% increase from the year-ago period. It was the fastest growth rate in three years, spurred by $2.1 billion in total loan originations, which was an 89% year-over-year jump. According to Wall Street's consensus estimate (provided by Yahoo! Finance), Upstart's annual revenue could top $1 billion in 2025 for the first time in the company's history. Upstart stock is down 84% from its 2021 peak. Like it was heavily overvalued back then with its P/S ratio surging to almost 50, but it has since come down to a more sustainable level of 8. Given the company's lightning fast revenue growth right now, and the incredible future opportunity in AI-powered loan originations, I think Upstart stock could be a great long-term buy at the current price. Before you buy stock in consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $704,676!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $950,198!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 175% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 23, 2025 Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Microsoft, Nvidia, Salesforce, and Upstart. The Motley Fool recommends and Fair Isaac and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. 2 Artificial Intelligence (AI) Stocks (Besides Nvidia) to Buy Hand Over Fist for the Long Term was originally published by The Motley Fool
Yahoo
4 days ago
- Business
- Yahoo
Upstart Stock Appreciates 40% QTD: Should You Take the Bait?
Upstart Holdings, Inc. UPST has delivered a strong gain of 40.1% so far in the quarter, significantly outperforming the Zacks Financial – Miscellaneous Services industry's 18.7% appreciation. In contrast to peers, such as LendingClub LC and Enova International ENVA, UPST has clearly emerged as one of the standout Holdings stands out for its disruptive business model and strategic growth initiatives, despite tackling economic headwinds and rising competition. UPST is reinventing consumer lending using artificial investors may be wondering if they've missed the investment opportunity or if there's still time to take a position. Let's explore further to determine whether it's wise to consider taking or increasing positions in UPST or waiting for a better entry point. Image Source: Zacks Investment Research Upstart is redefining credit underwriting through the application of artificial intelligence. At the core of its value proposition is a proprietary AI-based model that replaces the traditional FICO score with a more nuanced and predictive system, incorporating factors like education, employment history, and financial behavior. In first-quarter 2025, 92% of loans on its platform were fully automated, demonstrating unmatched efficiency and borrower experience. The company's superior automation rate, when combined with rising conversion rates (up from 14% to 19% YoY), underlines the tangible benefit of its model expansion beyond personal loans into verticals like auto refinancing, HELOCs, and small-dollar loans is paying off. Auto loan originations jumped 42% sequentially, HELOCs rose 52%, and small-dollar loans nearly tripled year over year. This diversification enhances revenue streams while enabling Upstart to test and fine-tune its AI model across product categories. Partnerships like the one with All In Credit Union also show Upstart's growing appeal among traditional lenders looking to reach more borrowers its focus on super-prime borrowers — now 32% of originations — reduces credit risk while increasing access to low-cost funding. Its marketplace model has diversified funding across banks, credit unions, and private credit providers, now with more than 50% of volume backed by committed AI innovation is a sustainable moat. Upstart integrated embeddings into its underwriting system — an advanced machine-learning method that transforms complex, unstructured data into actionable insights, enhancing the precision of credit evaluations. These embeddings enable the model to detect nuanced behavioral patterns among borrowers — for instance, recognizing relationships between different credit card types — thereby improving its ability to generalize and separate risk ahead, Upstart intends to debut its first machine-learning model for loan servicing, focused on boosting operational efficiency and lowering default rates, with the broader ambition of developing a distinctive, standalone servicing solution. However, challenges remain — elevated interest rates and a dip in contribution margins are notable. The growing super-prime borrower mix, while improving credit quality, also results in lower take rates due to intense competition. Moreover, margins in newer products like HELOC and auto lending are expected to mature over time, with initial take rates being modest due to early-stage scaling. Moreover, macroeconomic uncertainty and trade tensions add to the company's woes. The recent estimate revision trends do not provide a clear direction either. While the full-year 2025 consensus mark for EPS has been revised slightly downward over the past week, the same for 2026 has been adjusted above the prior projections. Image Source: Zacks Investment Research From a valuation perspective, we note that Upstart shares are currently overvalued, as suggested by the Value Score of terms of forward 12-month Price/Sales (P/S), Upstart is currently trading at 5.24X, which is at a premium to the industry average of 3.85X. Moreover, compared with major fintech rivals, the stock trades at a premium to LendingClub and Enova International. At present, LendingClub and Enova International have P/S multiples of 1.38X and 0.8X, respectively. Image Source: Zacks Investment Research While short-term macro risks remain, Upstart's differentiated technology, expanding loan mix, and improving profitability make it a compelling long-term fintech play. Investors seeking AI-driven disruption in consumer finance may find Upstart well worth the ride. However, it's also trading at a relatively high valuation. For now, holding the stock seems like the right move, especially if you have a longer investment horizon. Currently, Upstart Holdings carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Upstart Holdings, Inc. (UPST) : Free Stock Analysis Report LendingClub Corporation (LC) : Free Stock Analysis Report Enova International, Inc. (ENVA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 days ago
- Business
- Yahoo
Upstart Holdings (UPST) Jumps 9.78% on 'Overweight' Rating
We recently published . Upstart Holdings, Inc. (NASDAQ:UPST) is one of the stocks that soared higher on Tuesday. Upstart Holdings grew for a second day on Tuesday, jumping 9.78 percent to close at $64.85 apiece following an analyst's bullish rating on its stock. In a market note, Piper Sandler gave Upstart Holdings, Inc. (NASDAQ:UPST) an 'overweight' rating and a price target of $75, marking an upside of 15.65 percent from its latest closing price. The coverage was based on growth optimism for Upstart Holdings, Inc.'s (NASDAQ:UPST) near-term earnings, supported by the improvement of its artificial intelligence model, which enables more accurately priced loans. A close-up of a businesswoman using a laptop, being illuminated by the AI-enabled cloud interface sponsored by the company. Additionally, Piper Sandler was optimistic about its long-term prospects, saying that traditional lending practices 'are primed for technological disruption,' and that Upstart Holdings, Inc. (NASDAQ:UPST) was positioned well to penetrate a large total addressable market. Upstart Holdings, Inc. (NASDAQ:UPST) is an AI-powered lending marketplace for personal loans, automotive retail and refinance loans, home equity lines of credit, and small-dollar 'relief' loans. It connects millions of consumers to more than 100 banks and credit unions that leverage its AI models and cloud applications. While we acknowledge the potential of UPST as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey.
Business Wire
6 days ago
- Business
- Business Wire
Cobalt Credit Union Selects Upstart for Personal Loans, HELOCs, and Auto Refinance
PAPILLION, Neb. & SAN MATEO, Calif.--(BUSINESS WIRE)--Cobalt Credit Union (Cobalt), a leading credit union serving 115,000 members across the country with over $1.3 billion in assets, has announced its partnership with Upstart (NASDAQ: UPST), the leading artificial intelligence (AI) lending marketplace, to offer personal loans, HELOCs and auto refinance loans to more consumers. 'To support Cobalt's mission of being our members' trusted financial partner through every stage of life, we're focused on expanding our digital reach to deliver more accessible, tailored loan solutions,' said Robin Larsen, president and CEO of Cobalt Credit Union. 'By partnering with Upstart across its secured and unsecured products, we're able to offer competitive rates online, deploy capital with greater flexibility, and expand access to affordable credit for members nationwide." Cobalt Credit Union started lending as a partner on the Upstart Referral Network in March 2025, originating T-Prime personal loans, with plans to expand into auto refinance loans later this year. As part of the Upstart Referral Network, qualified loan applicants on who meet Cobalt's credit policies receive tailored offers as they seamlessly transition into a Cobalt-branded experience to complete the online member application and closing process. Cobalt is also purchasing portfolios of home equity lines of credit (HELOCs) from Upstart's affiliate, Upstart Mortgage, on an ongoing basis to further expand and diversify its consumer lending offerings. 'We are excited to have Cobalt be a part of the family of Upstart lending partners,' said Michael Lock, Senior Vice President of Lending Partnerships at Upstart. 'Through our partnership, Cobalt will be able to grow T-Prime personal loans, HELOCs and auto refinance loans, while also expanding its membership through an all-digital, lending experience.' About Upstart Upstart (NASDAQ: UPST) is the leading AI lending marketplace, connecting millions of consumers to more than 100 banks and credit unions that leverage Upstart's AI models and cloud applications to deliver superior credit products. With Upstart AI, lenders can approve more borrowers at lower rates while delivering the exceptional digital-first experience customers demand. More than 90% of loans are fully automated, with no human intervention by Upstart. Founded in 2012, Upstart's platform includes personal loans, automotive retail and refinance loans, home equity lines of credit, and small-dollar 'relief' loans. Upstart is based in San Mateo, California. About Cobalt Credit Union Cobalt Credit Union is locally owned by its members and recognized for its deep community involvement and military roots. Originally founded in 1946 at Andrews Field in Maryland to serve Air Force personnel, Cobalt moved with the Strategic Air Command to Offutt Air Force Base in 1948 and has remained committed to the military community ever since. Motivated by member service rather than profit, Cobalt's focus is on providing safety, soundness, and convenience. Today, Cobalt is a financial partner for life—helping members with better banking, home buying, investing, financial planning, education, retirement planning, and commercial services. The credit union proudly serves more than 115,000 members across the country, operates over 25 branch locations throughout Nebraska and Iowa, and manages over $1.3 billion in assets.
Yahoo
7 days ago
- Business
- Yahoo
Redwire, Upstart, Zevia, Domo, and Sweetgreen Shares Skyrocket, What You Need To Know
A number of stocks jumped in the afternoon session after the major indices rebounded (Nasdaq +1.4%, S&P 500 +1.0%) on hopes the reported ceasefire between Israel and Iran will hold. This de-escalation in a volatile region helped to ease concerns about potential disruptions to global oil supplies, leading to a notable dip in crude oil prices. Additionally, dovish signals from Federal Reserve Chair Jerome Powell in his Congressional testimony, reaffirming a "wait-and-see" approach on interest rates, further calmed markets, improving investors' appetite for stocks and other risk assets. The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Among others, the following stocks were impacted: Aerospace company Redwire (NYSE:RDW) jumped 8.7%. Is now the time to buy Redwire? Access our full analysis report here, it's free. Lending Software company Upstart (NASDAQ:UPST) jumped 8.4%. Is now the time to buy Upstart? Access our full analysis report here, it's free. Beverages, Alcohol, and Tobacco company Zevia (NYSE:ZVIA) jumped 8.6%. Is now the time to buy Zevia? Access our full analysis report here, it's free. Data Analytics company Domo (NASDAQ:DOMO) jumped 5.7%. Is now the time to buy Domo? Access our full analysis report here, it's free. Modern Fast Food company Sweetgreen (NYSE:SG) jumped 5.3%. Is now the time to buy Sweetgreen? Access our full analysis report here, it's free. Redwire's shares are extremely volatile and have had 92 moves greater than 5% over the last year. In that context, today's move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business. The previous big move we wrote about was 7 days ago when the stock dropped 17% on the news that the company priced a public offering for roughly 15.5 million shares of its common stock at a price of $16.75 per share. The gross proceeds from the offering were expected to be around $260 million. Notably, before the announcement, RDW had approx. 77million shares outstanding, which means the stock sale could significantly increase the supply. This could have a negative impact on its stock price as the increase in the supply of outstanding shares dilutes the ownership of existing shareholders. Redwire is down 2.8% since the beginning of the year, and at $16.58 per share, it is trading 35.4% below its 52-week high of $25.66 from February 2025. Investors who bought $1,000 worth of Redwire's shares at the IPO in January 2021 would now be looking at an investment worth $1,592. Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
