The Upstart (NASDAQ: UPST) stock price has crashed as investors focus on the company’s results and forward guidance. The shares plummeted by more than 50% to about $36, which is lower than its Monday’s close of $77. The current price is about 91% below the all-time high of $401. As a result, the company’s market cap has moved to about $3.5 billion.
Upstart weak earnings
Upstart Holdings is a fintech company that provides loans to individuals. It offers loans to help people pay off your credit cards, consolidate debts, wedding, medical, and refinance vehicles among others.
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Upstart does not offer loans direct from its resources. Instead, it has partnered with other companies like First Federal, Customers Bank, and First National Bank of Omaha among others.
In a statement on Monday, Upstart said that its loan transactions rose to more than $4.5 billion in the first quarter. It also added more than 500 dealerships and 57 banks and credit unions in its platform.
As a result, Upstart had net revenues of $310 million in the quarter, which was about 156% year-on-year. Revenue from fees rose to $314 million. Net interest income moved to a negative level even as the loans in its balance sheet saw a sustained decline in valuation.
Upstart processed about 465k loans as the number if new borrowers rose to 350k. Its balance sheet is still strong, with its net cash being at $1 billion. The CEO said:
“We see a clear path to building a company with more than $10 billion in revenue in the coming years and are maniacally focused on achieving that goal.â€
The Upstart stock price declined after the firm issued weak guidance. The company said that its revenue will be between $295 million and $305 million. The mid-point of this revenue growth was about 55%. For the full year, the company expects that its revenue rose to $1.25 billion, representing a 47% year-on-year growth.
Upstart stock price forecast
The daily chart shows that the Upstart share price has been in a strong downward trend in the past few months. The stock closed the day at $75.71, which was an important support level. The stock will open at $36.57, which was the lowest level since November 2020. Along the way, it has dropped below all moving averages.
Therefore, there is a possibility that the UPST stock price will keep falling as bears attempt to move below the support at $30.
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