Sign InUPST Stock Analysis: Bullish Momentum but Caution Advised Ahead of Earnings Announcement
Summary
As of July 12, 2023, Upstart Holdings, Inc. (UPST) has seen a 2.25% increase in its stock price, reaching $44.08 per share, but caution is advised as fundamental indicators show a negative EPS and high target price projections vary widely among analysts, while technically the stock appears to be overbought with a high RSI of 80, suggesting a potential retracement.
Company Overview
Upstart Holdings, Inc. (tick: UPST), based on NASDAQ, is under analysis. On July 12, 2023, it closed at $44.08 per share, marking a 2.25% increase ($0.97) from the previous trading day. Within this timeframe, the stock fluctuated between a low of $42.05 and a high of $44.91, its highest point within the fiscal year. The company has a market cap of $3.64 billion, a daily trading volume of 8.56 million shares which is slightly under its average trading volume of 9.34 million shares.
Fundamental Analysis
Despite its relatively favorable market performance, UPST's fundamental indicators suggest caution. It has a negative EPS of -$3.46, resulting into a negative PE ratio of -12.74. The earnings announcement is expected on August 8, 2023. Analyst projections show a high target of $180, a low estimate of $10 with the consensus coming in at $40.89 and the median target set at $20.5. It appears that though analyst consensus is below the current stock price, it represents a wide range of possibilities.
Recent information suggests that Upstart is part of the broader upward trend in fintech stocks associated with anticipated Federal Reserve policy changes. One report labeled Upstart as one of the 7 best stocks for investing in fintech right now. Furthermore, the company has shown increased take rates in the recent quarter thanks to better underwriting efficacy and limited competition.
Technical Analysis
The stock has demonstrated robust bullish activity. Its RSI14 stands at 80, indicating the stock is currently overbought. Its 50-day moving average is $27.54, and its 200-day moving average is $20.35, indicating a strong upward trend. Further, the 3-month MACD of 1.84 also suggests the momentum is with the bulls.
Predicting Stock Performance
Based on the technical indicators and recent news, the outlook for UPST's stock price for July 13, 2023 would appear optimistic. However, with an RSI of 80, there is potential for a retracement due to the overbought stock.
For the upcoming week, the stock may continue its uptrend, but the high RSI indicates it may also see some price correction. As such, traders must be cautious about any sudden reversals.
Final Evaluation
Given the current fundamental and technical analysis, UPST stock can be categorized as a 'Hold.' This consideration is based on the following:
Fundamentally, despite recent improved operational efficiency, the earnings per share figure remains concerning. Also, the broad range in analysts' target prices suggests uncertainty.
Technically, while the stock exhibits a strong upward trend, the high RSI indicates that it may be overbought, and a pullback could be imminent.
Investors should closely watch the upcoming earnings announcement and any news specifically related to UPST that could significantly affect its stock performance.
