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Upstart Holdings Inc Scores 55% Under Guru Model Analysis

A recent report highlights Upstart Holdings Inc's performance under a guru investment strategy, noting it achieved a 55% rating due to solid fundamentals, yet failed on profit margins and growth comparisons.

Date: 
AI Rating:   4

In a recent report analyzing Upstart Holdings Inc (UPST), the company received a rating of 55% based on the Small-Cap Growth Investor model. Although this score suggests that the stock has some appealing fundamentals, it falls short of the strong interest threshold, which typically requires an 80% score or more.

The analysis indicates several critical areas where UPST did not meet expectations:

  • Profit Margin: UPST failed to meet the required criteria, signaling issues with profitability. This could dampen investor confidence and potentially affect stock prices negatively.
  • Sales and EPS Growth Compared to Last Year: The stock also failed in this category, indicating that year-over-year growth is not meeting expectations, which could further dissuade potential investors.
  • Cash Flow from Operations: The failure to achieve adequate cash flow from operations is a significant concern, as it reflects on the company's ability to sustain operations and growth.
  • Income Tax Percentage: The report noted a failure here as well, which may suggest inefficiencies in tax management impacting the company's net income.

Despite these setbacks, UPST did perform positively in several categories, including:

  • Relative Strength: A strong performance in this area may instill some confidence in investors looking for growth potential.
  • Cash and Cash Equivalents: Maintaining sufficient cash reserves is important for operational security, and UPST passed this test.
  • Accounts Receivable to Sales: Successfully passing this criterion indicates effective management of receivables, which could protect against cash flow issues in the near term.

Overall, while the company shows some strong points that could be appealing in the long run, the significant failures in critical areas like profit margins, growth metrics, and cash flow could lead to investors reassessing their positions, adversely affecting stock prices in the near future.

Stocks:  UPST