2023-04-25 05:37:00 ET
Amid the rise in interest rates, the optimism surrounding Upstart Holdings (NASDAQ: UPST) gave way to hopelessness. The one-time high-growth company saw massive growth quickly turn negative as profits turned into losses and investors lost faith in the company's management team.
Presumably, Upstart's ultimate goal is to persuade lenders to drop Fair Isaac Corporation 's (NYSE: FICO) FICO score in favor of its evaluation tool. But given the state of its stock, it might stand a better chance of saving itself and Fair Isaac by seeking an alliance. Here are three reasons why:
For all of the problems with Upstart as a company, smart investors know it holds potential because its AI-driven model works. In other words, it can approve more loans without increasing default risks. In a rising rate environment, this is valuable to banks that may face more defaults as economic conditions worsen.
For further details see:
3 Reasons Upstart Should Seek an Alliance With Fair Isaac Corporation