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Upstart Earnings: What To Look For From UPST

StockStory - Mon Feb 12, 1:02AM CST

UPST Cover Image

AI lending platform Upstart (NASDAQ:UPST) will be reporting earnings tomorrow after the bell. Here's what to look for.

Last quarter Upstart reported revenues of $134.6 million, down 14.4% year on year, missing analyst expectations by 3.7%. It was a weak quarter for the company, with and underwhelming revenue guidance for the next quarter. Also, the company burned through significant amount of cash.

Is Upstart buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Upstart's revenue to decline 7.9% year on year to $135.3 million, improvement on the 51.8% year-over-year decrease in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.14 per share.

Upstart Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company missed Wall St's revenue estimates three times over the last two years.

Looking at Upstart's peers in the vertical software segment, some of them have already reported Q4 earnings results, giving us a hint of what we can expect. Agilysys delivered top-line growth of 21.3% year on year, beating analyst estimates by 0.8% and PTC reported revenues up 18.1% year on year, exceeding estimates by 2.3%. Both companies (Agilysys and PTC) traded flat on the results. 

Read our full analysis of Agilysys's results here and PTC's results here.

There has been positive sentiment among investors in the vertical software segment, with the stocks up on average 8.2% over the last month. Upstart is up 11.6% during the same time, and is heading into the earnings with analyst price target of $21.5, compared to share price of $33.9.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

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