UPST Quantitative Stock Analysis

Validea's guru fundamental report indicates that Upstart Holdings (UPST) receives a 61% rating based on their Small-Cap Growth Investor model, which is based on the published strategy of Motley Fool. While the stock passes tests for relative strength, insider holdings, cash flow from operations, cash, and accounts receivable, it fails tests related to profit margin, sales and EPS growth, profit margin consistency, the 'Fool Ratio', sales, and daily dollar volume. A score of 80% or higher typically indicates interest in the stock by the strategy.

Analysis

Upstart Holdings Inc. (UPST), a mid-cap growth stock operating in the Consumer Financial Services industry, has been assigned a 61% rating by Validea's Small-Cap Growth Investor model, a framework derived from the Motley Fool's published strategy. This rating falls short of the 80% level that typically signifies strategy interest and the 90% mark indicating strong interest, suggesting a lukewarm assessment by this particular model. The evaluation, which focuses on small-cap growth stocks with solid fundamentals and strong price performance, reveals a mixed fundamental picture for UPST. The company passed criteria such as Relative Strength, Insider Holdings, Cash Flow from Operations, Cash and Cash Equivalents, Accounts Receivable to Sales, Average Shares Outstanding, and Price. However, UPST failed on several critical metrics including Profit Margin, year-over-year Sales and EPS Growth comparison, Profit Margin Consistency, "The Fool Ratio" (P/E to Growth), overall Sales, Daily Dollar Volume, and Income Tax Percentage. R&D as a Percentage of Sales was rated neutral, further underscoring the nuanced performance of UPST against this specific growth investment strategy and aligning with the provided neutral sentiment signal.

Key Decisions for Investors

• Given UPST's 61% rating from the Small-Cap Growth Investor model is below typical interest thresholds, investors should critically assess the identified fundamental weaknesses, particularly concerning its failing grades on profit margins, recent sales and EPS growth deceleration, and the 'Fool Ratio' valuation metric.
• While the stock demonstrates positive relative price strength and operational cash flow, the significant number of failed criteria, including daily dollar volume which may signal liquidity or interest concerns for this strategy, warrants thorough due diligence before considering an investment based solely on this model's output.
• Investors should monitor for tangible improvements in UPST's profitability metrics, sales and EPS growth trajectory, and overall financial health, as these are key areas of concern highlighted by the Validea report based on the Motley Fool strategy.