Upstart stock was trading at $23.32 as of 03:24 PM EDT.
After Mizuho analyst Dan Dolev began coverage of the AI-powered lending platform firm at Underperform due to a hard environment for funding loans, Upstart Holdings’ ( NASDAQ:UPST ) shares were down 1.7% in premarket trade on Tuesday.
The business serves as a lending market. It gathers customer demand for loans by putting borrowers in touch with a network of banks and other lenders. However, Dolev said that Mizuho’s historical study shows that delinquencies are likely to rise as interest rates and inflation rise, which can make it harder to get money. He says that Upstart’s ( NASDAQ:UPST ) stock has dropped 95% from its peak because of a lack of cash. “In the upcoming quarters, greater hardship is expected.”
Upstart Stock Overview
Dolev said, “Our scenario analysis shows that if the finding is still disputed, UPST may need to rely on warehouse/own-balance-sheet lending to break even, which investors may not like.”
Keep in mind that Upstart’s (UPST) stock fell in August when the business indicated it would fund loans temporarily from its own balance sheet .
Upstart ( NASDAQ:UPST ) is valued by the analyst at 7x 2024E enterprise value/EBITDA, with a price objective of $17, which is 20% less than the stock’s closing price on Monday of $21.26.
Dolev’s rating of Underperform is more cautious than Wall Street’s typical rating of Hold, and it’s the same as the SA Quant recommendation of...
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