Sign InUpstart Holdings, Inc. (UPST) Shows Strong Performance and Potential Upside
Summary
Upstart Holdings, Inc. (UPST) stock shows strong performance and positive news, leading to a predicted continued upward momentum in the short term, with an undervaluation according to DCF analysis, making it a compelling buy, despite the risks associated with the high RSI and ongoing losses. (July 2023 analysis)
General Information
Upstart Holdings, Inc. (UPST) is a publicly-traded company listed on the NASDAQ exchange. As of the last closing day on July 28, 2023, the stock price closed at $65.18, a change of 10.59%, increasing by $6.24. The trading volume was 11.73 million, slightly above the average volume of 11.36 million shares.
On that day, the share price oscillated between a low of $60.26 and a high of $65.61. The highest price point the UPST shares achieved in the year was $67.22, whereas the year's lowest plummet was $11.93.
Market Position and Performance
Upstart's market capitalization is $5.39 billion, considering the total shares outstanding, which is approximately 82.67 million. A review of the share price compared to the 50 Day Moving Average ($37.056) and the 200 Day Moving Average ($22.329) shows the company's stock performs well above these averages.
The company's EPS (Earnings per Share) is currently at -$3.82, with a corresponding negative PE (Price to Earnings) Ratio of -17.06. This shows that the company is currently reporting losses.
Technical Analysis
The company's 3-month MACD (Moving Average Convergence Divergence), an indicator of the overall trend, is 7.856. This higher MACD suggests an upward trend. However, the RSI (Relative Strength Index) is currently 76, indicating overbought conditions. Its location above the typically used cutoff of 70 can signal that a price correction or a slowdown in the trend might be in the offing.
Fundamental Analysis, News, and Predictions
The Discounted Cash Flow (DCF) estimate for UPST is $70.28. According to the DCF analysis, UPST appears to be undervalued, which suggests upside potential.
Analyst consensus target prices for UPST vary widely, ranging from a low forecast of $10 to a high projection of $180, with a median target price of $20.5. However, it is crucial to bear in mind these figures are forecasts and can be misleading at times.
On the news front, investor sentiment appears to be increasingly bullish. Recent reporting indicates convincing quarterly earnings beats, analyst upgrades, and anticipation of beating estimates in the upcoming earnings report. The stock has gained a staggering 400% this year, one of the reasons it was subject to a short squeeze.
Additionally, the company has innovative products on its roadmap, including an upcoming home loan product. Speculation of the stock being able to reach $72 is circulating, following one BTIG analyst's revisions.
Short-Term Predictions
For the next trading day, July 31, 2023, UPST stock is likely to experience continued momentum, potentially pushing its price higher, based on its robust recent performance and positive news surrounding the stocks.
For the upcoming week, it is predicted that the stock might experience a pullback from the current price levels due to overbought conditions indicated by the high RSI.
Evaluation and Recommendation
Finally, based on its fundamental and technical analysis, UPST stock appears to be a compelling 'Buy.' This is primarily based on its above-average performance, upcoming product innovation, positive analyst recommendations, and undervaluation according to DCF analysis. However, investors should consider the risk associated with the high RSI and the ongoing losses reported by the firm.
