Why Upstart (UPST) Stock Is Down Today

What Happened?

Shares of AI lending platform Upstart (NASDAQ:UPST) fell 4.9% in the afternoon session after investor concerns grew over a weakening credit environment that affected the broader fintech sector. 

The negative sentiment was fueled by several factors, including reports of larger-than-expected loan losses from some regional banks and a rise in auto delinquencies. Furthermore, consumer sentiment had plunged, and signs pointed to a weakening labor market in recent months. This environment created worries for lending-focused companies like Upstart. The stock's decline also followed a previous drop after the company's recent earnings report, where its fourth-quarter revenue guidance of $288 million came in below the consensus estimate of $303.7 million, adding to investor apprehension.

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What Is The Market Telling Us

Upstart’s shares are extremely volatile and have had 74 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 3 days ago when the stock gained 4.2% on the news that a director and the company's Chief Technology Officer reported a significant purchase of 100,000 shares of company stock. The transaction, detailed in a regulatory filing, was viewed by investors as a strong vote of confidence from a key executive. Such a substantial purchase often suggested that the company's leadership believed in the firm's future prospects and saw the stock as undervalued. This move signaled to the market that those with inside knowledge of the company's operations were optimistic about its direction.

Upstart is down 40.2% since the beginning of the year, and at $36.38 per share, it is trading 59% below its 52-week high of $88.77 from February 2025. Investors who bought $1,000 worth of Upstart’s shares at the IPO in December 2020 would now be looking at an investment worth $1,235.

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