Shares of financial technology company Upstart (NASDAQ:UPST) dropped about 18% in Tuesday’s after-hours trading. The lower-than-expected top-line guidance for the first quarter of 2024 irked investors, leading to a decline in the stock price.
Upstart expects its Q1 revenue to be around $125 million. This was below the analysts’ consensus estimate of 152.3 million. The company’s management remains cautious in the near term, citing challenges stemming from the elevated interest rate environment and higher consumer risks.
Nevertheless, the company’s adjusted bottom-line forecast surpassed expectations. The company projects an adjusted net loss of $33 million in Q1, compared to analysts’ loss estimate of $34.4 million.
Upstart – Q4 Performance
Upstart delivered total revenue of $140.3 million, down 4% year-over-year. A challenging lending environment took a toll on its top line. However, UPST’s revenue exceeded the Street’s forecast of 134.8 million.
Further, the company reported an adjusted loss per share of $0.11 in Q4, which was in line with the analysts’ consensus estimate. Further, the company’s loss per share narrowed compared to the prior-year quarter. It posted a loss of $0.25 per share in the fourth quarter of 2022.
What is the Forecast for Upstart Stock?
The macro uncertainty and near-term pressure on its revenues keep analysts bearish about its prospects. Upstart stock has a Moderate Sell consensus rating with one Buy, three Hold, and three Sell recommendations.
UPST stock appreciated over 95% in one year. Thus, analysts’ average price target of $24.33 implies 26.09% downside potential from current levels.
