UPST stock

Upstart (UPST) stock is falling hard on Tuesday following the release of its earnings report for the first quarter of 2022.

On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. Given the general macro uncertainties and the emerging prospects of a recession later this year, we have deemed it prudent to reflect a higher degree of conservatism in our forward expectations.” That’s already surpassed its daily average trading volume of about 12.1 million shares. And this also has UPST stock seeing heavy trading this morning. Upstart reported adjusted earnings per share of 61 cents on revenue of $310 million. Starting with the second quarter 2022 guidance, the company expects revenue of $295 million to $305 million.

Shares of Upstart had fallen close to 60% after the company reported recent earnings results. Is this a buying opportunity?

Upstart runs a marketplace model, so it doesn't want to hold any loans on its balance sheet that it doesn't have to. Another huge red flag in the first-quarter report was the fact that Upstart significantly increased the number of loans it was holding on its balance sheet from about $252 million at the end of the fourth quarter to close to $600 million at the end of the first quarter. In addition, loans that may have qualified for a certain investor's risk appetite based on their specific risk criteria may no longer qualify. Upstart has already seen default rates normalize, which management attributes to the fading benefit of government stimulus. Well, Upstart, which uses technology and artificial intelligence to better assess the credit quality of borrowers for financial institutions and other investors, is no longer expecting the same kind of loan transaction volume it did a few months ago. Furthermore, Upstart originates loans to a range of borrowers across the credit spectrum, making a certain portion of its borrowers extremely risky.

Read Upstart (NASDAQ:UPST) Releases Quarterly Earnings Results, Beats Expectations By $0.08 EPS at Defense World.

Piper Sandler cut shares of Upstart from an “overweight” rating to a “neutral” rating and reduced their price objective for the company from $230.00 to $44.00 in a research note on Tuesday. Finally, Citigroup reduced their price objective on shares of Upstart from $350.00 to $180.00 and set a “buy” rating on the stock in a research note on Friday, April 22nd. They issued an “outperform” rating and a $150.00 price objective on the stock. They issued an “equal weight” rating and a $124.00 price objective on the stock. Its platform connects consumers, banks, and institutional investors through a shared AI lending platform. The shares were sold at an average price of $144.05, for a total transaction of $1,080,375.00. The disclosure for this sale can be found here. According to data from MarketBeat, Upstart has an average rating of “Buy” and an average price target of $183.79. The shares were sold at an average price of $108.39, for a total value of $9,032,463.87. Following the sale, the chief executive officer now directly owns 87,114 shares of the company’s stock, valued at approximately $9,442,286.46. The sale was disclosed in a legal filing with the SEC, which can be accessed through the SEC website. FBN Securities began coverage on shares of Upstart in a research note on Tuesday, April 12th. Stephens began coverage on shares of Upstart in a research note on Thursday, March 31st. Upstart updated its FY 2022 guidance to EPS and its Q2 2022 guidance to $0.29-$0.31 EPS. Barclays decreased their price target on shares of Upstart from $285.00 to $180.00 in a research note on Thursday, February 17th. Upstart had a net margin of 15.96% and a return on equity of 21.33%. The business had revenue of $310.14 million for the quarter, compared to analysts’ expectations of $300.13 million.

Shares of Upstart plummeted Tuesday after the consumer lending platform cut its full-year revenue outlook.

"We expect there could be further downside based on the speed and intensity of a recession." Plus, the company noted borrower defaults are normalizing. The company, which uses artificial intelligence to gauge creditworthiness, said climbing interest rates are hurting loan volume. Shares of Upstart plummeted Tuesday after the artificial intelligence lending platform cut its full-year revenue outlook, citing rising interest rates and an uncertain economy. - Upstart, which uses artificial intelligence to gauge creditworthiness, cited climbing interest rates and the risk of a recession. - Shares of Upstart plummeted Tuesday after the AI consumer lending platform cut its full-year revenue outlook.