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Upstart Provides Upbeat Q4 Outlook on Better-than-Expected Q3 results

Artificial intelligence (AI) lending platform Upstart Holdings (UPST) has provided upbeat fourth-quarter revenue guidance after the company posted better-than-expected third-quarter 2021 results. Despite this, shares of the company plunged 20.2% in the extended trading session on Tuesday after closing 6.2% lower on the day. 

Results in Detail 

The company registered adjusted earnings of $0.60 per share, topping the consensus estimate of $0.35 per share. Upstart had reported adjusted earnings of $0.16 per share in the same quarter last year. 

Revenues increased 250% year-over-year to $228.5 million and came well ahead of analysts’ expectations of $214.9 million. Markedly, fee revenue grew 235% to $210 million. (See Upstart stock charts on TipRanks) 

During the quarter, Bank Partners originated 362,780 loans for an aggregate of $3.13 billion, across the company’s platform, up 244% year-over-year. Additionally, conversion on rate requests stood at 23%, up from 15% in the same quarter last year. 

Upstart recorded adjusted EBITDA of $59.1 million at the third quarter-end, up from $15.5 million in the prior-year quarter. 

CEO Comments 

In response to the third-quarter results, the CEO of Upstart, Dave Girouard, said, “Since Upstart’s IPO a year ago, we’ve more than tripled our revenue, tripled our profits, tripled the number of banks and credit unions on our platform, and tripled the number of auto dealerships we serve. With that many 3s, Upstart is becoming the Steph Curry of the FinTech industry.” 


For the fourth quarter of 2021, the company projects revenue to be in a range of $255 million to $265 million against the consensus estimate of $226.6 million. The range represents a year-over-year growth rate of 200% at the midpoint. Additionally, adjusted EBITDA is anticipated to be in the range of $51 million to $53 million.  

For 2021, the company forecasts revenue of $803 million, up from the prior expectation of $750 million. 

See Insiders’ Hot Stocks on TipRanks >> 

Wall Street’s Take 

The rest of the Street is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on 3 Buys, 2 Holds and 1 Sell. The average Upstart price target stands at $325.33 and implies upside potential of 3.7% to current levels. Shares have skyrocketed 255.6% over the past six months. 

Bloggers Weigh In 

TipRanks data shows that financial blogger opinions are 82% Bullish on UPST, compared to a sector average of 71%.

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