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Upstart Holdings, Inc. (NASDAQ:UPST) closed slightly lower on July 24, 2023, with a negative EPS and PE ratio, but positive technical figures indicate a generally positive trend, leading to a hold recommendation.
Fundamental Analysis
Upstart Holdings, Inc. (NASDAQ:UPST) reported a last close of $53.64 on July 24, 2023, showing a slight decline of -0.98%. The company's market cap stands at $4.43 billion. Upstart, however, has not made a profit: its EPS is -3.11. Furthermore, its PE ratio is also negative at -17.25. The stocks optimistic predictions come from a lofty 12-month high of $61.5 and a narrowed yearly low of $11.93.
The company's average volume stands at approximately 10.59 million, and the latest turnover was 6.40 million. Such movement generates liquidity, making it an attractive option for investors looking to buy or sell large volumes of shares.
Upon examining Upstart's moving averages, the 50-day moving average (MA) stands at $33.71, while the 200-day MA is about $21.57. These values indicate a clear positive uptrend of the stock, as the stock price is currently higher than both moving averages. The bullish MACD of 4.93 supports this trend.
For its discounted cash flow (DCF), Upstart showed a value of $58.74. If accurate, this value suggests that the stock is currently undervalued by the market.
However, its target consensus stands at $40.89, quite below the current price and also below DCF value. With a target high of $180 and a low of $10, target predictions for Upstart stock span a significant range, indicating uncertainty in the stock's value.
Technical Analysis
Upstart's RSI14 is at 75, which is generally considered overbought territory. This situation typically indicates that the stock might face a short-term pullback.
Offerings of the company are also being discussed with a mixed narrative. Some news suggests that Upstart is one of the 'AI stocks to sell before the competition crushes them,' but other articles recommend purchasing, classifying it as one of the 'Moonshot AI Stocks to Buy Immediately' and among the '2 AI Stocks That Could Help Make You a Fortune.'
News hinting at Upstart's expected return to profitability and robust growth with the loosening of the credit market and economic improvement paints a hopeful picture for the company's future.
Stock Forecast and Evaluation
Given the stock's recent trajectory, Upstart could close at a slightly lower figure in its next trading session (July 25, 2023), possibly near its lowest recent price of $52.14, due to its overbought RSI status. However, improvement could be expected in the following week as the stock adjusts from its overbought status unless negative catalysts appear.
Despite the mixed opinions circulating in the news, the company's positive technical figures cannot be ignored. The stock's trend, barring any unforeseen sharp adverse market movement, should remain generally positive.
However, considering the stock's overbought status, recent negative EPS, and the negative sentiment from some reports suggesting it as a sell before its competition outpaces it, investors interested in the stock should approach it with caution.
Based on the fundamental and technical analysis, the verdict on Upstart at this moment would be a Hold. The stock has potential due to its upward trend and future prospects, but the overbought status and the current negativity surrounding its profitability give cause to exercise discretion.
