Upstart's Q4 Earnings Show Strong Revenue Growth Ahead

Upstart reports 56% revenue growth for Q4 2024, exceeding expectations. With a promising outlook, experts remain cautiously bullish on the stock as it aims for profitability and significant revenue milestones in 2025.

Date: 24-02-2025

AI Rating: 7

Strong Earnings Per Share (EPS) Forecast
Upstart's forecast for 2025 adjusted EPS stands at $1.39, a significant recovery from a loss of $0.20 in 2024. This strong earnings forecast indicates a potential positive trend that could enhance investor confidence, driving stock prices higher if actual performance aligns with expectations.

Revenue Growth
The company has reported a remarkable 56% year-over-year revenue growth for the latest fourth quarter, reaching $637 million in 2024. Moreover, Upstart is guiding for a revenue estimate of $1 billion in 2025, which represents a 58% increase from 2024. Such strong revenue growth could attract investors seeking growth stocks, displaying the company's robust market position.

Key Performance Metrics
In addition, Upstart's loan origination rose significantly, totaling $2.1 billion, which is up 68% from the prior year. The increase in the conversion rate from 11.6% to 19.3% indicates higher operational efficiency and potential for future profitability.

Overall Sentiment
While Upstart exhibits impressive numbers in revenue growth and an improving EPS forecast, there are cautionary notes regarding competition and valuation. Upstart faces formidable competition from other fintech companies such as SoFi Technologies, LendingTree, and Rocket. The high valuation multiple at 57 times the forward EPS could pressure the stock if future results underperform expectations or macroeconomic conditions worsen.

With all these factors in consideration, Upstart's positive trends in revenue and earnings can be viewed as promising for its stock prices if the competitive landscape remains manageable and the overall market conditions are favorable.

Stocks: UPST