Upstart (UPST), a rapidly expanding AI-driven lending platform, leverages a capital-light and asset-light business model. The company posted strong performance in 2025 and offers promising guidance for 2026, yet its stock remains undervalued.
Robust 2025 Results and 2026 Outlook
Upstart achieved impressive results throughout 2025. For 2026, the platform forecasts $1.4 billion in revenue alongside a 21% adjusted EBITDA margin. This trajectory points to a 35% compound annual growth rate (CAGR) over the next three years, with revenue expected to reach $2.5 billion by 2028.
Compelling Valuation for Growth Investors
UPST shares currently trade at a forward price-to-earnings ratio below 10. This valuation positions the stock as an attractive growth-at-a-reasonable-price play in the AI lending sector.
Key Risks to Consider
Lending platforms face inherent cyclical challenges, including potential dilution from stock-based compensation. Macroeconomic pressures, such as Federal Reserve interest rate increases, may reduce loan origination volumes and weigh on the share price.
