Upstart Holdings Stock Surges After Needham Upgrade: Retail Sentiment Soars

Shares of AI-lending platform Upstart Holdings Inc (UPST) rose over 12% on Friday after Needham reportedly upgraded the stock to ‘Buy’ from ‘Hold’ while keeping a price target of $100. This implies a nearly 15% upside from the current trading levels.

“Coming off the meetings, we believe that UPST has achieved a proper balance in funding, largely due to the increased appetite and partnerships with committed capital buyers,” Needham analysts wrote after meeting with the firm’s executives, according to a Barron's report.

“We also expect the funding environment to steadily improve as the short-end of the yield curve continues to come down,” they said.

The brokerage sees UPST as a good fit for growth investors, and anticipates that growth and margins will significantly improve in the coming quarters, according to the report.

Following the upgrade, retail sentiment on Stocktwits climbed into the ‘extremely bullish’ territory (85/100) from ‘bearish’ a day ago. The move was accompanied by ‘extremely high’ message volume.

UPST’s Sentiment Meter and Message Volume as of 1:25 p.m. ET on Dec. 13, 2024 | Source: Stocktwits

Earlier this month, Redburn Atlantic analyst Simon Clinch reportedly upgraded Upstart to ‘Buy’ from ‘Neutral’ with a price target of $95, up from $37.

The firm noted that Upstart has now delivered two quarters that exceeded expectations, with forward guidance an incremental positive.

Redburn also noted the significant market opportunity for Upstart's business, a powerful blend of AI and a scalable technology platform, that could boost the share price to over $250 in the next five years.

Notably, shares of Upstart have gained over 124% since the beginning of the year.

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