{ "@context": "https://frontierpicks.com/schemas/dossier.v1.json", "ticker": "UPST", "name": "Upstart Holdings, Inc.", "url": "https://frontierpicks.com/dossiers/UPST/", "json_url": "https://frontierpicks.com/dossiers/UPST.json", "status": "WATCHLIST", "current_conviction": "LOW", "archetype": { "code": "a7", "n": 7 }, "current_thesis": "Upstart Holdings is more likely to lag the S&P 500 over the next three months: it cut its 2026 outlook and October lending slowed. November originations and the fourth-quarter report will show whether the slowdown deepens or reverses.", "invalidation_trigger": "A daily close above $24.10, which would put the shares over the 50-day moving average and above every close since the 2026-11-03 report. Alternatively, November daily originations above the third quarter's $51.6 million daily pace.", "catalyst_date": "2026-11-30", "portfolio": null, "pick": null, "themes": [ "fintech-consumer-credit" ], "tags": [], "sources": [], "notes": [ "Upstart publishes monthly originations and its Upstart Macro Index reading between quarterly reports, so volume trends are visible before each earnings release.", "Chief Accounting Officer Natalia Mirgorodskaya resigns effective 2026-11-30; CFO Andrea Blankmeyer serves as interim principal accounting officer until a permanent replacement is found." ], "source_links": [ { "title": "Upstart Holdings, Inc. - Form 8-K - FY2026", "url": "https://www.sec.gov/Archives/edgar/data/0001647639/000164763926000083/upst991prq32026.htm", "date": null }, { "title": "Yahoo Finance", "url": "https://finance.yahoo.com/markets/stocks/articles/upstart-holdings-inc-upst-q3-210427506.html", "date": "2026-11-03" }, { "title": "Upstart Holdings, Inc. - Form 8-K - FY2026", "url": "https://www.sec.gov/Archives/edgar/data/0001647639/000164763926000086/upst-20261103.htm", "date": "2026-11-09" }, { "title": "Upstart Shares Are Retreating Tuesday: What's Happening? (CORRECTED)", "url": "https://www.benzinga.com/trading-ideas/movers/26/11/62818630/upstart-shares-are-retreating-tuesday-whats-happening", "date": null }, { "title": "Upstart Holdings (UPST) Is Up 5.8% After $4 Billion Loan Pact And Conditional Bank Approval", "url": "https://www.webull.com/news/15342457431008256", "date": null }, { "title": "FOMC Meeting Schedule", "url": "https://fedratecalc.com/fomc-meeting-schedule/december-2026/", "date": null } ], "evidence": [ { "claim": "Q3 2026 total revenue was $370.5M (+34% YoY) and fee revenue $364.0M (+41%); GAAP net income was $36.6M, diluted EPS $0.33 and adjusted EBITDA $89.3M.", "source": "Q3 2026 earnings release, 8-K exhibit 99.1", "as_of": "2026-11-03" }, { "claim": "Q3 2026 originations were $4.12B on 574,089 loans (+44% YoY in dollars); contribution margin was 60% vs 57%; conversion rate was 18.6% vs 19.4%.", "source": "Q3 2026 earnings release, 8-K exhibit 99.1", "as_of": "2026-11-03" }, { "claim": "The FY2026 outlook is about $1.32B of fee revenue (down from $1.40B), about $1.35B of total revenue and about $260M of adjusted EBITDA.", "source": "Q3 2026 earnings release; Benzinga 2026-11-03", "as_of": "2026-11-03" }, { "claim": "October 2026 originations were $1.249B, or $48.1M per business day; the daily pace was down 9% from September and up 26% YoY.", "source": "Upstart October 2026 originations release; Q3 2026 earnings call", "as_of": "2026-11-03" }, { "claim": "The UMI averaged 1.5% in Q3 vs 1.41% in Q2; the $260M EBITDA guidance assumes the UMI stays at or below 1.55 through year-end.", "source": "Q3 2026 earnings call", "as_of": "2026-11-03" }, { "claim": "CEO Paul Gu bought 50,000 shares on the open market at $25.55.", "source": "SEC Form 4 filed 2026-09-10", "as_of": "2026-09-10" }, { "claim": "President Sanjay Datta exercised 300,000 options at $1.35 and sold 116,000 shares on the open market at $27.29.", "source": "SEC Form 4 filed 2026-09-10", "as_of": "2026-09-08" }, { "claim": "Chief Accounting Officer Natalia Mirgorodskaya gave notice of her resignation, effective 2026-11-30; CFO Andrea Blankmeyer will serve as interim principal accounting officer.", "source": "Form 8-K Item 5.02 filed 2026-11-09", "as_of": "2026-11-09" } ], "view_changes": [], "frame": null, "filed_numbers": { "as_of": "2026-11-13", "sector": "Financial Services", "financials": { "status": "ok", "reason": null, "close_date": "2026-11-13", "latest_quarter": "2026-09-30", "figures": { "revenue": { "status": "ok", "quarters": [ { "end": "2026-09-30", "filed": "2026-11-03", "value_musd": 370.5, "yoy_pct": 33.7 }, { "end": "2026-06-30", "filed": "2026-08-04", "value_musd": 364.7, "yoy_pct": 41.7 }, { "end": "2026-03-31", "filed": "2026-05-05", "value_musd": 308.2, "yoy_pct": 44.4 }, { "end": "2025-12-31", "filed": "2026-02-10", "value_musd": 296.1, "yoy_pct": 35.2 }, { "end": "2025-09-30", "filed": "2026-11-03", "value_musd": 277.1, "yoy_pct": 70.9 }, { "end": "2025-06-30", "filed": "2026-08-04", "value_musd": 257.3, "yoy_pct": 101.6 } ] }, "gross_margin": { "status": "not reported" }, "operating_margin": { "status": "ok", "quarters": [ { "end": "2026-09-30", "filed": "2026-11-03", "pct": 9.7 }, { "end": "2026-06-30", "filed": "2026-08-04", "pct": 4 }, { "end": "2026-03-31", "filed": "2026-05-05", "pct": -2.4 }, { "end": "2025-12-31", "filed": "2026-02-10", "pct": 6.4 }, { "end": "2025-09-30", "filed": "2026-11-03", "pct": 8.5 }, { "end": "2025-06-30", "filed": "2026-08-04", "pct": 1.8 } ] }, "pretax_income": { "status": "not reported" }, "net_income": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "four_quarters_end": "2026-09-30", "value_musd": 36.6, "four_quarters_musd": 65.1 }, "operating_cash_flow": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "first_end": "2025-12-31", "value_musd": -181.1 }, "capital_spending": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "first_end": "2025-12-31", "value_musd": 5.8 }, "free_cash_flow": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "first_end": "2025-12-31", "value_musd": -187 }, "diluted_share_change": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "base_end": "2025-09-30", "pct": 14.3 }, "cash": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "value_musd": 461.5 }, "debt": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "value_musd": 2027.3 }, "net_cash": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "value_musd": -1565.8 }, "deferred_revenue": { "status": "not reported" }, "backlog": { "status": "not reported" }, "receivables": { "status": "not reported" }, "inventory": { "status": "not reported" }, "equity": { "status": "ok", "end": "2026-09-30", "filed": "2026-11-03", "value_musd": 887.4 }, "market_value": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-10-27", "basis_filed": "2026-11-03", "value_musd": 1934.7 }, "enterprise_value": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-10-27", "basis_filed": "2026-11-03", "value_musd": 3500.5 }, "ev_sales": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-10-27", "basis_filed": "2026-11-03", "multiple": 2.6 }, "ev_ebit": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-10-27", "basis_filed": "2026-11-03", "multiple": 56.4 }, "pe": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-10-27", "basis_filed": "2026-11-03", "multiple": 29.7 }, "pb": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-10-27", "basis_filed": "2026-11-03", "multiple": 2.2 }, "fcf_yield": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-10-27", "basis_filed": "2026-11-03", "pct": -9.7 } } }, "short_interest": { "status": "ok", "settlement": "2026-10-15", "published": "2026-11-13", "short_pct_of_outstanding": 27.18, "days_to_cover": 6.4, "change_pct": -5.9 }, "insiders": { "status": "ok", "as_of": "2026-11-14", "windows": [ { "days": 90, "status": "ok", "from": "2026-08-17", "bought_usd": 1277500, "sold_usd": 4373799.74, "bought_unpriced": 0, "sold_unpriced": 0 }, { "days": 365, "status": "ok", "from": "2025-11-15", "bought_usd": 7652565.8, "sold_usd": 7410429.06, "bought_unpriced": 0, "sold_unpriced": 0 } ] } }, "body_markdown": "## Current Thesis\nUpstart Holdings is more likely to lag the S&P 500 over the next three months. On 2026-11-03 it reported record third-quarter volume, but on the same day it lowered its 2026 outlook and showed lending slowing in October. The November originations release and the fourth-quarter report will show whether the slowdown deepens or reverses.\n\nThe rating is Low because the business still depends on interest rates and on Upstart's own credit-stress gauge, and both moved the wrong way in the third quarter. The company estimated that a rising Upstart Macro Index (UMI) and higher rates took about $370 million out of third-quarter originations (Q3 call, 2026-11-03). October originations ran at $48.1 million per business day. That is 9% below September's daily pace (company release, 2026-11-03).\n\nThe price already reflects a smaller 2026. At the 2026-11-11 close of $20.56, the shares trade below the $24 targets that Goldman Sachs, Morgan Stanley and Stephens set on 2026-11-04. In this view, the price allows for the reduced outlook but not for a second quarter of falling daily volume.\n\n## Bull Case\n- **Third-quarter fee revenue set a record.** Fee revenue was $364.0 million, up 41% from a year earlier. Total revenue was $370.5 million, up 34% (Q3 2026 earnings release, 2026-11-03).\n- **Lending volume and contribution profit grew.** Originations were $4.12 billion on 574,089 loans, up 44% in dollars. Contribution margin was 60%, against 57% a year earlier (earnings release, 2026-11-03).\n- **Secured lending turned profitable.** Secured loans earned a 17% contribution margin in the third quarter, against negative 35% in the second, and secured fee revenue was $34 million (Q3 call, 2026-11-03).\n- **The chief executive bought shares.** Chief Executive Paul Gu bought 50,000 shares on the open market at $25.55 on 2026-09-10 (SEC Form 4). That price is above the 2026-11-11 close.\n- **Buy-rated analysts see room above the price.** After the report, Citi kept a Buy rating with a $46 target, B. Riley Buy with $42 and BTIG Buy with $40 (2026-11-03 to 2026-11-04). Needham and Truist cut their targets to $30.\n\n## Bear Case\n- **The 2026 outlook was cut.** Upstart now guides to about $1.32 billion of fee revenue, down from $1.40 billion (Benzinga, 2026-11-03). It also guides to about $1.35 billion of total revenue and about $260 million of adjusted EBITDA, which is earnings before interest, taxes, depreciation and amortization (earnings release, 2026-11-03).\n- **October volume slowed.** October originations were $1.249 billion, or $48.1 million per business day. The daily pace was 9% below September's (company release and Q3 call, 2026-11-03).\n- **Fewer applicants were approved.** The conversion rate fell to 18.6% in the third quarter from 19.4% a year earlier (earnings release, 2026-11-03).\n- **The guidance assumes credit stress stops rising.** The UMI averaged 1.5% in the third quarter, up from 1.41% in the second, and its latest reading was 1.53. The $260 million EBITDA guide assumes the index stays at or below 1.55 through year-end (Q3 call, 2026-11-03).\n- **Loan-value write-downs are hurting income.** Net interest income and fair-value adjustments came to about $6 million in the third quarter, down 65% from a year earlier. Management said most of the expected fourth-quarter fair-value hit will come from write-downs of beneficial-interest assets (Q3 call, 2026-11-03).\n- **Insiders sold and an officer is leaving.** President Sanjay Datta sold 116,000 shares at $27.29 on 2026-09-08 after exercising options (SEC Form 4). Chief Accounting Officer Natalia Mirgorodskaya resigns effective 2026-11-30 (8-K, 2026-11-09).\n\n## Setup & Price Structure\nThe shares closed at $20.56 on 2026-11-11. That is just above the 52-week closing low of $20.41, set on 2026-11-10. The last close is 60.5% below the 52-week intraday high of $52.10, reached on 2026-01-06. Over three months the shares are down 33.6% from the $30.97 close of 2026-08-13.\n\nOn 2026-11-04, the session after the report, the shares closed at $23.38. They have not closed that high since, and by 2026-11-10 they had fallen another 12.7%. The price sits below both the 50-day moving average of $24.06 and the 200-day moving average of $28.90 (adjusted daily closes, as of 2026-11-11).\n\nTwo levels frame the case. The 50-day average sits close to the $24 targets set by Goldman Sachs, Morgan Stanley and Stephens. The $25.55 price Paul Gu paid on 2026-09-10 sits above it.\n\n## Catalyst Calendar\n\n- **2026-11-30:** Chief Accounting Officer resignation takes effect; CFO becomes interim principal accounting officer. This tests whether the accounting function stays steady through the year-end close and the 2026 annual report without a permanent chief accounting officer.\n- **~2026-12-03 (est.):** November 2026 originations and UMI update. This shows whether daily lending volume keeps falling from October's $48.1M or recovers toward the third quarter's pace, and whether the UMI stays at or below the 1.55 the guidance assumes.\n- **2026-12-09:** Federal Reserve interest-rate decision. Rates drive Upstart's funding costs, loan approvals and fair-value write-downs; management blamed higher rates for part of the third-quarter originations shortfall.\n- **~2027-02-10 (est.):** Q4 2026 results and 2027 outlook. This shows whether the cut 2026 guidance holds and whether the 2027 outlook returns to growth, including progress on opening Upstart Bank in early 2027.\n\n## What Would Change Our Mind\n\nA daily close above $24.10, which would put the shares over the 50-day moving average and above every close since the 2026-11-03 report. Alternatively, November daily originations above the third quarter's $51.6 million daily pace.\n\n## Correlation Notes\nUpstart's volume depends on interest rates and on consumer-credit conditions. Management attributed the estimated $370 million third-quarter originations shortfall to a rising UMI and higher rates (Q3 call, 2026-11-03). The shares therefore tend to move with rate expectations and consumer-credit news, more than with the broader technology sector. The Federal Reserve's 2026-12-09 decision is the next shared driver.\n\nMore than 95% of Upstart's loans are funded by third parties, mainly through multi-year forward-flow agreements, such as the up-to-$4 billion commitment from Castlelake announced in July 2026. That model links Upstart to private-credit buyers' appetite for consumer loans. Upstart Bank, which management says is on track to open in early 2027 (Q3 call, 2026-11-03), would reduce that dependence. It falls outside the three-month window.", "first_seen": "2026-11-12", "last_analyzed": "2026-11-12T18:14:49+00:00", "last_synthesized": "2026-11-12", "date_modified": "2026-11-12", "license": "Content © FrontierPicks. Cite the canonical URL." }