UPST Upstart Holdings Inc

Upstart Holdings operates an AI-powered lending marketplace that uses machine learning models to connect borrowers with bank and credit union partners, improving credit risk assessment. Sector: Financials.

Upstart Holdings Inc (UPST) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

Examining the company through a capital allocation lens, ROIC is 3.78%, WACC is 11.27%, and the economic spread is -7.49%. On balance, the economic spread is negative, indicating that at current return levels, reinvestment is value-destructive in aggregate. Supporting metrics show ROE at 7.95% and ROA at 2.03%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company that likely needs operating improvement before returns quality can be considered durable.

Multiple analysis puts the company at trailing P/E of 61.20, forward P/E of 12.23, PEG of 3.10. The spread from trailing to forward multiple is wide enough to suggest earnings momentum is a meaningful part of the current valuation case. Growth-adjusted, the company is priced at a premium — a level that demands consistent execution and limits the potential for multiple expansion from here. The aggregate current ratio of 10.46 reflects a company with strong liquidity buffers against short-term stress. The combined valuation and liquidity profile points to a company where current prices embed meaningful growth expectations, and where delivery against those expectations will drive the return outcome.

From gross to free cash flow, gross margin sits at 83.04%, operating margin at 6.96%, and free cash flow margin at 24.88%. At this level, gross margins reflect the kind of pricing power and cost insulation that characterizes category-leading businesses. Operating margins are thin enough to warrant attention — businesses at this level are more exposed to cost inflation. The company's FCF margin is above average, pointing to the company with efficient capital deployment and durable cash generation. The margin profile is mixed, with some layers more resilient than others and less room for execution slippage.

Revenue momentum and analyst targets together paint a picture where the estimated 12-month price change of 31.10%, where analysts are collectively positioned for a material move higher, while TTM revenue growth of 41.75% reflecting top-line acceleration that, if sustained, supports the forward earnings case. Reported revenue growth is the operational foundation; the analyst target spread shows what the market is willing to pay above it — and that premium can evaporate quickly if delivery slips. For investors, the central question is whether the operating momentum visible in revenues is durable enough to support the price appreciation implied by consensus targets. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

The fundamental case holds up across most key dimensions — the combination of positive economic spread, reasonable valuation, and analyst support is constructive.

The analysis above draws from quantitative data only and does not constitute personalized financial advice. Investors should conduct independent research and consider professional guidance before acting on any information presented here.