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Upstart (UPST) to Report Q1 Earnings: What's in the Offing?

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Upstart Holdings UPST is slated to release first-quarter 2021 results on May 11.

This would be the company’s second quarterly results following its listing on the Nasdaq stock exchange in December 2020.

The company projects revenues between $112 million and $118 million. The Zacks Consensus Estimate for quarterly revenues is pegged at $115.2 million. Moreover, the Zacks Consensus Estimate for earnings is pegged at 15 cents per share.

Upstart Holdings, Inc. Price and Consensus

Upstart Holdings, Inc. Price and Consensus
Upstart Holdings, Inc. Price and Consensus

Upstart Holdings, Inc. price-consensus-chart | Upstart Holdings, Inc. Quote

Let’s see how things have shaped up prior to the upcoming announcement.

Factors to Consider

Upstart is a FinTech company that provides cloud-based artificial intelligence (AI)-powered lending platform to banks and financial institutions. The firm’s fiscal first-quarter performance is likely to have benefited from the increased usage of AI by banks to check the credit worthiness of loan applicants.

Upstart claims that its lending algorithm is more effective than the current systems at accurately depicting a person’s ability to repay a loan. Moreover, banks using its AI algorithm have higher approval rates and lower loss rate. The platform also helps banks provide exceptional digital-first lending experience to customers. The benefits of its platform are anticipated to have aided the company’s top-line growth during the first quarter.

The aforementioned benefits of its platform are likely to have helped Upstart add new customers, thereby generating incremental revenues during the quarter in discussion. Notably, in March, Apple Bank launched its digital unsecured personal loan product — Personal Loans by Apple Bank — powered by Upstart AI. Prior to that in February, Midwest BankCentre selected the company to digitally process its auto refinance service.

Upstart’s expanding foothold among leading banks is also likely to have been a key catalyst. Moreover, management’s efforts to fortify its footprint across the United States will likely reflect on the quarterly results.

What Our Model Says

Our proven model does not predict an earnings beat for Upstart this time around. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

Upstart currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%.

Stocks With Favorable Combinations

Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming releases:

Ralph Lauren Corporation RL has an Earnings ESP of +6.25% and currently sports a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Walt Disney Company DIS has an Earnings ESP of +46.11% and carries a Zacks Rank #3, at present.

Rackspace Technology, Inc. RXT has an Earnings ESP of +4.55% and currently carries a Zacks Rank #3.

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