Upstart stock jumps after BTIG upgrade, sees 55% upside
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- Vincent Caintic upgraded Upstart to a buy rating from neutral, prompting a 5.4% rise in the stock on Monday.
- Upstart submitted a banking charter application to the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp last Tuesday, seeking to become a bank.
- The bank charter is projected to cut Upstart's private‑credit exposure and transaction‑volume costs, boosting adjusted operating earnings per share by about 60% annually.
- Vincent Caintic set a $43 price target for Upstart, implying roughly 55% upside from its current price.
- Annie Delgado, Upstart’s chief risk officer and prospective bank CEO, emphasized that AI‑based lending will shape future credit and that the firm will work directly with regulators.
- The analyst expects charter approval by late 2026 or early 2027, which could start reducing expenses as early as 2027.
Why it matters: Investors gain a clearer path to profitability as Upstart’s bank charter could lower its expensive private‑credit exposure and transaction fees, boosting earnings per share by 60% annually; meanwhile, the company’s risk profile improves while shareholders see potential 55% price appreciation.
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