UPST - Upstart Debt Dilemma: Capital Raise On The Horizon? Sell This Stock
2024-06-11 14:09:42 ET
Summary
- I believe Upstart Holdings, Inc.'s heavy debt load will need to be addressed within the next year, likely requiring a capital raise.
- With a valuation of 40 times next year's EBITDA, investors are paying a large premium for a financially constrained company.
- Given these factors, I am revising my rating and concluding that Upstart Holdings stock is a sell.
Investment Thesis
Upstart Holdings, Inc. ( UPST ) has one significant issue. It carries a lot of debt. And I believe that this debt will need to be tackled in the next year, before its debt becomes current on its balance sheet (meaning a financial obligation that is due within a year)....
Upstart Debt Dilemma: Capital Raise On The Horizon? Sell This Stock