Citi upgrades Upstart to Buy on funding momentum

Citi analyst Peter Christiansen upgraded Upstart (UPST) to Buy from Neutral with a price target of $87, up from $56, following the Q3 report. The firm says credit boxes for unsecured consumer loans haven’t widened, though the existing return profile is gaining the attraction of private credit managers, as well as Upstart’s existing partner network given improved liquidity. This dynamic “changes the equation for stock, perhaps bridging production levels towards the notion of a potential consumer debt consolidation cycle,” the analyst tells investors in a research note. Citi thinks Upstart stands in a relatively stronger position than two years ago to take advantage of new sources of funding, a declining rate environment, and improved platform capabilities. This sets the stage for continued positive revisions, improving sentiment, and an expanding valuation, contends the firm.