UPST - Upstart: A Great Anti-Cyclical AI Lending Bet

2024-05-24 03:01:17 ET

Summary

• Upstart's Q1 earnings beat expectations on both the top and bottom lines.
• The company's revenue base showed a solid 24% Y/Y growth in Q1. Personal loans, in both volume and transaction dollars, have seen double-digit growth.
• UPST's prospects are improving with the Federal Reserve's interest rate pivot, making it an attractive bet for growth investors.

Upstart's ( UPST ) shares initially soared after the fintech submitted its results for the first fiscal quarter, which beat expectations on the top and bottom lines. The company is seeing a stabilization of its revenue base and the outlook for the company, especially as far as loan demand is concerned, is improving. I believe that Upstart is a very promising bet for growth investors now that the Federal Reserve is nearing a point of an interest rate pivot. While shares are not cheap, the company has a very good chance to see a revenue acceleration in a lower-rate world, which in my opinion translates to a very attractive risk profile....

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